HSBC Bank Canada is reporting improved profit for the fourth quarter ended Dec. 31, 2003.

The bank says net income for the quarter was $73 million increase of 12.3% over the fourth quarter of 2002.

For the year ended Dec. 31, 2003, net income was $300 million, an increase of 15.4% over the same period in 2002.

Return on average common equity was 17% for the fourth quarter, and 18.7% for the year.

Total assets were $37.5 billion at Dec. 31, 2003 compared to $35.2 billion a year ago.

Total assets under administration were $18.7 billion at Dec. 31, 2003, of which $14.3 billion were funds under management and $4.4billion were custody and administration accounts.

Commenting on the results, Lindsay Gordon, president and CEO, said: ” Our personal and commercial banking customers helped us to weather a number of negative events such as the SARS outbreak, ‘mad-cow’ disease, forest fires in British Columbia and the electricity blackout in Ontario, as well as uncertainty in the world economy throughout most of the year.”

He added that “Net income benefited from an improved credit environment over the course of 2003 which resulted in lower credit losses compared with 2002. Personal loans and residential mortgages continued to grow as a result of lower interest rates and an active housing market.”

Capital market fees in the fourth quarter and year ended Dec. 31, 2003 were higher than the same periods in 2002 due to increased retail trading commissions, as a result of the strengthening equity markets since the first quarter of 2003, and higher corporate advisory fees.

Retail trading commissions from HSBC InvestDirect in 2003 were $22 million compared with $6 million in 2002. The higher retail trading revenues in 2003 were partially offset by lower institutional trading revenue as the institutional equity business was restructured in 2002.

HSBC Bank Canada acquired Merrill Lynch HSBC Canada Inc. on Oct. 31, 2002 and subsequently renamed HSBC InvestDirect Inc. on Nov. 1, 2003.

The banks said it plans to hire more than 100 stockbrokers in the near future to bolster its retail business. The bank currently has a stable of 135 brokers.

The bank’s tier 1 capital ratio was 8.4% and the total capital ratio was 11.1% at Dec. 31 2003. This compares with 8.4% and 11.4%, respectively, at the end of 2002.