investment-linked policy sub-funds - page not found policy sub-funds annual report for the year...

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Investment-linkedpolicy sub-fundsAnnual report for the year ended 30 June 2016.

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report

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Contents

Fund Updates 3

Fund Performance Summary 7

Notes to the Fund Disclosures 9

HSBC Insurance Asia Balanced Fund 10

HSBC Insurance Asia Equity Fund 14

HSBC Insurance Asia Focused Income Fund 17

HSBC Insurance Asian Bond Fund 21

HSBC Insurance Asian Dividend Equity Fund 25

HSBC Insurance China Balanced Fund 29

HSBC Insurance China Equity Fund 33

HSBC Insurance Chinese Equity Fund 36

HSBC Insurance Climate Change Equity Fund 39

HSBC Insurance Emerging Europe Equity Fund 43

HSBC Insurance Emerging Markets Equity Fund 47

HSBC Insurance Ethical Global Equity Fund 50

HSBC Insurance Ethical Global Sukuk Fund 54

HSBC Insurance Europe Dynamic Equity Fund 58

HSBC Insurance Europe Equity Fund 61

HSBC Insurance Global Bond Fund 64

HSBC Insurance Global Emerging Markets Bond Fund 68

HSBC Insurance Global Emerging Markets Equity Fund 72

HSBC Insurance Global Equity Fund 75

HSBC Insurance Global Equity Index Fund 79

HSBC Insurance Global Equity Volatility Focused Fund 82

HSBC Insurance Global High Income Bond Fund 85

HSBC Insurance Global Multi-Asset Fund 88

HSBC Insurance India Equity Fund 91

HSBC Insurance Japan Equity Fund 95

HSBC Insurance Pacific Equity Fund 99

HSBC Insurance Premium Balanced Fund 103

HSBC Insurance Premium Property Equity Fund 106

HSBC Insurance SGD Reserve Fund 112

HSBC Insurance Singapore Balanced Fund 116

HSBC Insurance Singapore Bond Fund 120

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report

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HSBC Insurance Singapore Equity Fund 124

HSBC Insurance US Equity Index Fund 127

HSBC Insurance US Opportunities Equity Fund 130

HSBC Insurance World Selection Funds 133

Independent Auditors’ Report to HSBC Insurance (Singapore) Pte. Limited 141

Financial Statements 144

Notes to the Financial Statements 157

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: Fund Updates

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Fund Updates 1 July 2015 to 30 June 2016

1. Change in the Sub-Investment Manager of the Underlying Sub-Fund of HSBC Insurance Premium Property Equity Fund with effect from 6 November 2015

We were informed by Henderson Global Investors (Singapore) Limited that Harrison Street Securities LLC (the “Sub-Investment Manager”) will cease to provide investment management services relating tothe North American portfolio of Henderson Horizon Fund – Global Property Equities Fund (the “Underlying Sub-Fund”), with effect from 6 November 2015.The investment manager of the UnderlyingSub-Fund, Henderson Global Investors Limited (the “Investment Manager”) believes that investors’ interests are best served by bringing the investment management of the North American portfolio of theUnderlying Sub-Fund in-house. The Investment Manager has enhanced its global property equitiescapabilities with the recruitment of a US-based portfolio manager to support the range of globalproperty equity mandates managed by the Investment Manager, including the North American portfolio of the Underlying Sub-Fund.

The investment objective and investment focus of the Underlying Sub-Fund and, therefore, of HSBC Insurance Premium Property Equity Fund, remains unchanged.

2. Change in the investment objective, focus and approach of the Underlying Fund of HSBC Insurance Asia Equity Fund with effect from 16 November 2015

We were informed by Deutsche Asset Management (Asia) Limited of changes to the investmentobjective, focus and approach of Deutsche Asia Premier Trust (the “Underlying Fund”) with effect from 16 November 2015.

There is a growing trend of companies to list in markets other than in the jurisdiction where thecompany is established. For example, a company established and operating in an Asian country mayhave its stocks listed in the United States only. Due to this trend, Deutsche Asset Management (Asia)Limited (the “manager”) has proposed to amend the investment objective of the Underlying Fund toenable it to invest in good Asian companies and to better reflect the investment universe for which theUnderlying Fund was intended.

With effect from 16 November 2015, the new investment objective of the Underlying Fund and hence,of HSBC Insurance Asia Equity Fund will be to achieve capital appreciation in the medium to long-term by investing in a diversified portfolio of equity and equity-related securities (including warrants andconvertible securities):

(i) Issued by entities listed on the stock exchanges of countries in Asia (Ex-Japan); (ii) Of entities domiciled or organized under the laws of the countries in Asia (ex-Japan); and/or (iii) Of entities (wherever domiciled or organized) which, in the opinion of the managers of the

Underlying Fund, have significant assets, business, production activities, trading or otherbusiness interests in Asia (ex-Japan)

The countries in Asia (ex-Japan) include, but are not limited to, Hong Kong SAR, Taiwan, Korea, China,the Philippines, Thailand, Malaysia, Singapore, Indonesia and the Indian sub-continent. On an ancillary basis, the Underlying Fund may also invest in other countries (including Australia and New Zealand) ifthe manager of the Underlying Fund deem this to be in the interest of the Underlying Fund.

The investment focus and approach of the Underlying Fund will remain substantially the same. Theintention is to maintain a diversified spread of investment within the Asia (ex-Japan) markets which would achieve the objective (as stated above) and lessen the volatility attached to individual marketsand stocks.

Investments may be made directly or through investment in other collective investment schemes whichare aligned with the investment objective of the Underlying Fund. Investments may also include, withlimitation, preference shares, depository receipts or offshore instruments (e.g. American DepositoryReceipts traded on the U.S. stock markets). The current policy not to use financial derivatives orengage in securities lending or repurchase transactions for the Underlying Fund also remainsunchanged.


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3. Change in the share class of the Underlying Sub-Fund of HSBC Insurance Ethical Global Equity Fund with effect from 27 November 2015

We were informed by Templeton Asset Management Ltd of a change in the share class of FranklinTempleton Shariah Funds (“FTSF”) – Templeton Shariah Global Equity Fund A (acc) SGD (“theUnderlying Fund”) with effect from 27 November 2015, HSBC Insurance Ethical Global Equity Fund willinvest in the newly created AS share class for CPFIS investors. There is no change in objective and no action is required.

This is in compliance with the Central Provident Fund Board's (“CPFB”) announcement on furtherreduction of the limits on the Total Expense Ratio (“TER”) for unit trusts under the CPF InvestmentSchemes (“CPFIS”), as part of CPFB’s continuous efforts to lower the cost of investing under theCPFIS.

In compliance with the reduced TER caps, FTSF will launch a new “AS” share class on 27 November2015.

4. Change in name of the Underlying Fund of HSBC Insurance Global Equity Fund with effect from 5 February 2016 and adoption of NAV adjustment policy with effect from 2 November 2015.

HSBC Insurance Global Equity Fund feeds into AllianceBernstein – Global Equity Blend Portfolio (the “Underlying Sub-Fund”), a Portfolio of the AllianceBernstein umbrella fund (the “Underlying Fund”) ofwhich AllianceBernstein (Luxembourg) S.à.r.l. is the management company (the “ManagementCompany”).

We were informed by the Management Company of the following changes:

(a) Change in name of the Underlying Fund With effect from 5 February 2016, the name of the Underlying Fund will be changed from“AllianceBernstein” to “AB FCP I”. The Underlying Sub-Fund will also be re-named accordingly. The change in name will not affect the investment strategy of the Underlying Fund’s Portfolios.

(b) Adoption of a NAV adjustment policy (the “Swing Pricing Policy”) With effect from 2 November 2015, the Underlying Fund will implement a Swing Pricing Policy in orderto counter the effects of dilution on a Portfolio’s Net Asset Value brought about by large purchases orredemptions in the Portfolio.

Swing pricing involves an adjustment to the net asset value of the Portfolio to adjust for transactioncosts incurred as a result of the significant net inflows or outflows. Such transaction costs mayadversely affect existing investors, an issue referred to as dilution. Swing pricing is part of the net assetvaluation process and is not a separate fee.

The adoption of the Swing Pricing Policy does not impact the investment management of the Portfolio. Investors should note that because swing pricing involves the adjustment of the net asset value of thePortfolio, its use may result in increased volatility of the value of the Portfolio.

5. Change in investment objective of HSBC Insurance India Equity Fund with effect from 20 May2016.

We were informed by HSBC Global Asset Management (Singapore) Limited on a change in investmentobjective for HSBC Global Investment Funds – Indian Equity (the “Underlying Sub-Fund”) due to a change in the way the Underlying Sub-Fund invests in India, with effect from 20 May 2016. Theinvestment objective of HSBC Insurance India Equity Fund changed accordingly as it invests 100% intothe Underlying Sub-Fund.

(a) Manner of Investment in India To achieve its investment objective, the Underlying Sub-Fund previously invests part or all of the netproceeds of the issue of its shares in HSBC GIF Mauritius Limited (the “Subsidiary”), which is a Mauritian incorporated company wholly owned by HGIF. Under normal market conditions, the subsidiary company invests substantially all of its assets in the target investments listed in the sub-fund’s investment objective above.


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The Subsidiary currently benefits from a favourable tax treatment, due to the double taxation treatybetween Mauritius and India, which in turn benefits the Underlying Sub-Fund and its investors.

The Board of the Underlying Sub-Fund decided that the Underlying Sub-Fund’s investments will be made directly rather than through the Subsidiary. Consequently, the Underlying Sub-Fund will divest its holdings in the subsidiary company over a period of time at the end of which the subsidiary companywill be liquidated.

(b) Changes to the investment objective The Board of the Underlying Sub-Fund has also taken the opportunity of the change above to enhancethe overall description of the investment strategy of the sub-fund. In particular, the Board has reviewedthe use of financial derivative instruments and has decided to implement in the investment objective a standardised wording bringing further clarity as well as consistency throughout the investmentobjectives of the Underlying Sub-Fund. It will better describe the purposes of using financial derivativeinstruments and how extensively these instruments may be used by the Underlying Sub-Fund.

As a result, the investment objective of the Underlying Sub-Fund will be changed accordingly to introduce powers to use financial derivative instruments.

6. Changes to HSBC Global Investment Funds (“HGIF”) (the “HGIF Underlying Sub-Funds”) which ILP Sub-Funds invest into, with effect from 20 June 2016.

We have been informed by HSBC Global Asset Management (Singapore) Limited (the “Fund Manager”) of certain changes to some of the sub-funds of the HSBC Global Investment Funds (“HGIF”)(the “HGIF Underlying Sub-Funds”) which the following ILP Sub-Funds invest into.

Type of change Name of ILP Sub-Fund Name of HGIF Underlying Sub-Fund

1. Investment Objective HSBC Insurance Chinese Equity Fund

HGIF - Chinese Equity

1. Investment Objective HSBC Insurance Global Equity Volatility Focused Fund

HGIF - Global Equity Volatility Focused

1. Investment Objective 2. Investment in

Contingent Convertible Securities

HSBC Insurance Asia Focused Income Fund

HGIF - Managed Solutions - Asia Focused Income

2. Investment in Contingent Convertible Securities

HSBC Insurance Global Emerging Markets Bond Fund

HGIF - Global Emerging Markets Bond

2. Investment in Contingent Convertible Securities

HSBC Insurance Global High Income Bond Fund

HGIF - Global High Income Bond

The abovementioned changes will be implemented with effect from 20 June 2016 (the “Effective Date of Change”). Details of these changes were disclosed in Appendix A of our notification letter toimpacted policyholders dated 5 May 2016 (the “Notification Letter”). These changes will apply to the relevant HGIF Underlying Sub-Fund(s) as described therein and consequently, the respective ILP Sub-Fund(s). The amended investment objectives provided by the Fund Manager are tabulated inAppendix B of the Notification Letter for your ease of reference.

If you have invested in the HSBC Insurance Global Emerging Markets Bond Fund, please note that theshare class name of the relevant HGIF Underlying Sub-Fund will be amended from Class AMH-SGD to Class AM3HSGD from 20 June 2016. Please note that there is no change to the nature of the shareclass other than a change in name


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7. Changes to HSBC Insurance Japan Equity Fund due to merger of Schroder InternationalSelection Fund – Japanese Equity Alpha with Schroder International Selection Fund – Japanese Equity

We have been informed by Schroder Investment Management (Luxembourg) S.A. (the “Management Company”) of a merger between Schroder International Selection Fund – Japanese Equity Alpha (the “Merging Fund”) and Schroder International Selection Fund – Japanese Equity (the “Receiving Fund”)(the “Merger”). The Merger will take place on 17 August 2016 (the “Effective Date”)

HSBC Insurance Japan Equity Fund invests 100% into the Receiving Fund, which will not be interrupted by the Merger. The Management Company does not foresee any material impact on theReceiving Fund’s investment portfolio or performance as a result of the Merger. Prior to the Merger, theMerging Fund will dispose of any assets which do not fit well in the Receiving Fund’s investment portfolio or which cannot be held due to investment restrictions and the Receiving Fund will continue tobe managed according to its current investment objective and policy. The Receiving Fund’s investmentportfolio will not need to be rebalanced before or after the Merger.

The expenses incurred in the Merger, including the legal, audit and regulatory charges will be borne bythe Management Company.

8. Delisting HSBC Insurance Global Equity Fund and HSBC Insurance China Equity Fund from the Central Provident Fund Investment Scheme (the “CPFIS”).

(a) HSBC Insurance Global Equity Fund We have been informed by AllianceBernstein (Singapore) Ltd that AllianceBernstein - Global Equity Blend Portfolio (the “Underlying Sub-Fund”), which HSBC Insurance Global Equity Fund invests into,will be withdrawn from CPFIS.

With effect from 31 August 2016, the Underlying Sub-Fund will be delisted from CPFIS and no longerbe eligible to take in new CPF monies. This is due to a mandatory evaluation which deemed that theUnderlying Sub-Fund no longer meets the CPF Board’s benchmark for continued inclusion underCPFIS.

(b) HSBC Insurance China Equity Fund CPF Board announced a reduction in Total Expense Ratio (“TER”) caps for ILP sub-funds included under CPFIS, in an effort to lower cost of investing. As the TER of HSBC Insurance China Equity Fundcannot meet the new TER caps, it will be delisted from CPFIS with effect from 31 August 2016.

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: Fund Performance Summary

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Fund Performance Summary

Cumulative Annualised 3-Mth

(%)6-Mth

(%)1-Year

(%)3-Year

(%)3-Year

(%)HSBC Insurance Asia Balanced Fund 0.59 (2.95) (11.91) (0.44) (0.15)Benchmark * 1.12 (0.05) (5.67) 16.14 5.11

HSBC Insurance Asia Equity Fund (0.24) (5.55) (17.39) 1.71 0.57 Benchmark * 0.12 (2.81) (12.27) 12.31 3.95

HSBC Insurance Asia Focused Income Fund 2.98 6.25 1.70 10.09 3.26 The Fund has no benchmark

HSBC Insurance Asian Bond Fund 1.34 2.58 3.23 10.38 3.35 Benchmark * 0.30 0.67 1.59 2.64 0.87

HSBC Insurance Asian Dividend Equity Fund 0.63 (3.06) (10.66) 4.01 1.32 Benchmark * 0.41 (2.89) (10.21) 11.79 3.78

HSBC Insurance China Balanced Fund (0.17) (7.33) (19.01) 10.99 3.54 Benchmark * 0.25 (6.44) (15.97) 13.17 4.21

HSBC Insurance China Equity Fund 0.11 (8.52) (18.32) 25.57 7.89 Benchmark * 0.06 (9.58) (23.41) 17.20 5.43

HSBC Insurance Chinese Equity Fund 0.55 N.A. N.A. N.A. N.A.Benchmark * (0.11) N.A. N.A. N.A. N.A.

HSBC Insurance Climate Change Equity Fund (2.24) (8.12) (6.70) 19.19 6.03 Benchmark * 0.96 (4.51) (2.82) 29.81 9.09

HSBC Insurance Emerging Europe Equity Fund 0.43 4.89 (2.04) (14.16) (4.96)Benchmark * (3.81) 4.32 (11.68) (24.73) (9.04)

HSBC Insurance Emerging Markets Equity Fund 0.74 (1.88) (11.78) (1.30) (0.43)Benchmark * 0.61 0.96 (12.09) 1.22 0.40

HSBC Insurance Ethical Global Equity Fund 0.57 (5.16) (8.12) 2.95 0.98 Benchmark * 3.59 (0.22) (1.00) 25.39 7.83

HSBC Insurance Ethical Global Sukuk Fund 1.12 (1.64) 1.59 24.95 7.71 Benchmark * 2.05 (0.81) 4.32 22.15 6.90

HSBC Insurance Europe Dynamic Equity Fund (1.23) N.A. N.A. N.A. N.A.Benchmark * 1.61 N.A. N.A. N.A. N.A.

HSBC Insurance Europe Equity Fund (5.14) (12.57) (11.75) 12.19 3.91 Benchmark * (2.74) (9.99) (11.26) 12.48 4.00

HSBC Insurance Global Bond Fund 2.01 5.24 7.92 16.65 5.27 Benchmark * 2.67 6.43 9.12 19.92 6.24

HSBC Insurance Global Emerging Markets Bond Fund 4.20 9.13 7.02 14.42 4.59 Benchmark * 5.35 5.21 10.27 27.97 8.57

HSBC Insurance Global Emerging Markets Equity Fund 4.37 N.A. N.A. N.A. N.A.Benchmark * 0.61 N.A. N.A. N.A. N.A.

HSBC Insurance Global Equity Fund (1.27) (7.49) (9.82) 22.94 7.13 Benchmark * 0.96 (4.51) (2.82) 29.81 9.09

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: Fund Performance Summary

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Cumulative Annualised 3-Mth

(%)6-Mth

(%)1-Year

(%)3-Year

(%)3-Year

(%)HSBC Insurance Global Equity Fund (0.61) N.A. N.A. N.A. N.A.Benchmark * (0.29) N.A. N.A. N.A. N.A.

HSBC Insurance Global Equity Volatility Focused Fund (0.39) N.A. N.A. N.A. N.A.The Fund has no benchmark

HSBC Insurance Global High Income Bond Fund 2.53 N.A. N.A. N.A. N.A.Benchmark * 3.56 N.A. N.A. N.A. N.A.

HSBC Insurance Global Multi-Asset Fund 1.34 N.A. N.A. N.A. N.A.The Fund has no benchmark

HSBC Insurance India Equity Fund 3.59 (8.94) (10.88) 25.14 7.76 Benchmark * 5.18 (3.63) (4.30) 46.10 13.47

HSBC Insurance Japan Equity Fund (7.85) (23.91) (25.07) (7.98) (2.74)Benchmark * (7.29) (22.31) (21.66) 2.59 0.85

HSBC Insurance Pacific Equity Fund 2.99 (1.19) (10.86) (3.58) (1.21)Benchmark * 0.51 (2.76) (10.04) 12.00 3.85

HSBC Insurance Premium Balanced Fund 0.05 (2.77) (4.90) 7.03 2.29 Benchmark * 0.59 (0.87) (3.49) 10.33 3.33

HSBC Insurance Premium Property Equity Fund (0.35) (2.55) 5.03 24.05 7.45 Benchmark * 1.32 0.58 6.04 30.73 9.34

HSBC Insurance SGD Reserve Fund 0.08 0.07 0.32 0.28 0.09 Benchmark * 0.17 0.44 0.86 1.53 0.51

HSBC Insurance Singapore Balanced Fund 0.60 0.39 (7.10) (1.86) (0.62)Benchmark * 0.30 0.18 (7.78) 0.57 0.19

HSBC Insurance Singapore Bond Fund 0.73 1.95 2.11 5.55 1.82 Benchmark * 0.28 0.54 0.97 1.75 0.58

HSBC Insurance Singapore Equity Fund 1.69 (0.19) N.A. N.A. N.A.Benchmark * 0.29 0.00 N.A. N.A. N.A.

HSBC Insurance US Equity Index Fund 0.42 N.A. N.A. N.A. N.A.Benchmark * 1.77 N.A. N.A. N.A. N.A.

HSBC Insurance US Opportunities Equity Fund (0.38) N.A. N.A. N.A. N.A.Benchmark * 0.76 N.A. N.A. N.A. N.A.

HSBC Insurance World Selection 1 Fund 1.52 (1.54) 2.16 16.12 5.11 The Fund has no benchmark

HSBC Insurance World Selection 3 Fund 0.42 (3.48) (1.67) 15.87 5.03 The Fund has no benchmark

HSBC Insurance World Selection 5 Fund (1.19) (6.37) (6.25) 15.41 4.89 The Fund has no benchmark

* Refer to the respective funds for the benchmark used.

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: Notes to the Fund Disclosures

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Notes to the Fund Disclosures

1. Performance figures

Performance figures are calculated using bid-to-bid prices, with any income or dividends reinvested and in Singapore dollars.

2. Expense ratio

Expense ratio are calculated in accordance with IMAS guidelines for the disclosure on expense ratio. The expense ratio does not include (where applicable) charges for insurance coverage, brokerage and other transaction costs, performance fee, foreign exchange gains or losses, front or back end loads arising from the purchase or sale of collective investment schemes and tax deducted at source or arising out of income received.

3. Turnover ratio

Turnover ratio represent the number of times per year that a dollar of assets is invested and is calculated based on the lower of purchases or sales for the 12 months preceding the reporting date expressed as a percentage of the daily average Net Asset Value.

4. Abbreviations Used

CPFIS : Central Provident Fund Investment Scheme GDP : Gross Domestic Product Ltd : Limited MV : Market Value N.A. : Not Applicable NAV : Net Asset Value OA : Ordinary Account SA : Special Account SRS : Supplementary Retirement Scheme

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Asia Balanced Fund

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HSBC Insurance Asia Balanced Fund

Fund Objective

HSBC Insurance Asia Balanced Fund seeks to achieve capital growth over the medium to longerterm by investing primarily 70% of the portfolio asset value in Asian equities and 30% in high quality debt securities of major bond market. The Fund invests substantially all or all its assets primarily 70% into the Legg Mason Western Asset Asian Enterprise Trust and 30% into the Legg Mason Western Asset Global Bond Trust.

Legg Mason Western Asset Asian Enterprise Trust

Investment and Market Review ^

FUND FACTS Underlying Funds 70%: Legg Mason Western

Asset Asian Enterprise Trust 30%: Legg Mason Western Asset Global Bond Trust

Fund Manager Western Asset Management Company Pte. Ltd.

Launch Date 01 Nov 2007 CPFIS/SRS SRS CPFIS Risk Classification

N.A.

As at 30 Jun 2016 Offer Price S$ 0.77168 Bid Price S$ 0.73310 Fund Size S$ 3.50 mil Units in Issue 4.78 mil

Global markets took a tumble after the unexpected results of the United Kingdom (UK) referendum on the future of its European Union (EU) membership. Most investors were not positioned for the “Brexit” result and this was reflected in one of history’s most dramatic declines in the sterling pound as well as global equitymarkets. There have been no signs of financial distress and central bank liquidity swap lines have not beenactivated so far. Brexit may just be the perfect excuse for central banks around the world to extend furthermonetary easing and for governments to seriously consider fiscal easing. This will provide some relief toAsian markets which had come under pressure by prospects of United States (US) interest rate tightening. The impact of Brexit on Asia may be more financial flow than trade-related. Any potential weakness could beoffset by additional monetary and fiscal easing. Indonesia, India and Korea have been leading the way oninterest rate cuts and Korea recently announced a fiscal budget boost.

Market Outlook and Investment Strategy ^

The highly regarded Reserve Bank of India (RBI) governor Raghuram Rajan made a surprise announcementthat he would not seek an extension of his three-year term, which ends in September. The fear now is thatIndia will no longer continue with the cleaning up of the banking system. In the short-term, markets will likely be supported by easier monetary policy while it awaits news on Rajan’s replacement.

South Korea is the latest country to join the monetary easing bandwagon. The economy is struggling with anongoing corporate restructuring in the beleaguered shipbuilding and shipping industries which could lead tomassive layoffs. There is growing pressure on the central bank to announce quantitative easing measures(QE), specifically to purchase Korea Development Bank bonds and mortgage-back securities. If this were to happen, it would be the first emerging market to engage in QE.

While the impact of Brexit on Asian equities is unlikely to extend much beyond the initial shock, and while itisn't a replay of 2008, Brexit nevertheless serves to refocus investors' attention on the plethora of unresolvedmacro-economic challenges that have hobbled financial investments and risk taking in general for so manyyears now. The prospect for the US rate cycle turning benign and of renewed monetary easing across mostparts of the world is helpful, thanks to Brexit. Earnings revision in Asia appears to have troughed for now, in part helped by a US dollar (USD) no longer rising unabatedly, and commodity prices that are rebounding.

Legg Mason Western Asset Global Bond Trust

*Please refer to HSBC Insurance Global Bond Fund on page 64 for the Investment and Market Review andthe Market outlook and Investment Strategy.

^ Source: Western Asset Management Company Pte. Ltd.


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A) Fund Performance I Cumulative Total Returns

3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Asia Balanced Fund 0.59 (2.95) (11.91) (0.44) (2.88) N.A. (22.83) Benchmark* 1.12 (0.05) (5.67) 16.14 18.67 N.A. 6.55

II Average Annual Compounded Returns

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Asia Balanced Fund (0.15) (0.58) N.A. (2.96) Benchmark* 5.11 3.48 N.A. 0.74

*70% MSCI AC Asia ex Japan + 30% Citigroup World Government Bond ex Japan Index (Hedged to S$) ^Inception Date:15 Nov 2007

B) Fund Disclosure I Allocation by Asset Class As at 30 Jun 2016 Asset Class % of NAV MV S$ mil

Legg Mason Western Asset Asian Enterprise Trust 64.29 2.25Legg Mason Western Asset Global Bond Trust 35.71 1.25

Total 100.00 3.50

II Fund Movement (01 Jul 2015 - 30 Jun 2016) S$

Subscription 881,328 Redemption 229,082

C) Underlying Fund Disclosure (Legg Mason Western Asset Asian Enterprise Trust) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

China 24.08 36.56South Korea 17.07 25.91Hong Kong 13.77 20.91Taiwan 10.43 15.84Singapore 9.36 14.21India 7.50 11.39Philippines 6.69 10.15Thailand 3.32 5.04Others* 5.49 8.32Cash 2.29 3.47

Total 100.00 151.80*Include other countries

II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil

Financials 23.81 36.17Consumer 23.54 35.73Information Technology 18.22 27.66Industrials 9.38 14.24Real Estate 8.39 12.73Construction/Materials 4.78 7.25Miscellaneous 2.65 4.02Energy 1.97 2.99Telecommunication 1.96 2.98Utilities 1.59 2.41Healthcare 1.42 2.15Cash 2.29 3.47

Total 100.00 151.80


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III Allocation of Debt Securities by Credit Ratings As at 30 Jun 2016 N.A.

IV Top Ten Holdings of Underlying Fund As at 30 Jun 2016 % of NAV MV S$ mil

Samsung Electronics Co Ltd 5.37 8.15Tencent Holdings Ltd 3.87 5.87Ping An Insurance Co of China Ltd H Shares 3.12 4.74Industrial and Commercial Bank of China H Shares 2.93 4.45LG Household & Health Care Ltd 2.86 4.34Hong Kong Exchanges and Clearing Ltd 2.79 4.24Ezion Holdings Ltd 2.71 4.11Yes Bank Ltd 2.62 3.97Shree Cements Ltd 2.61 3.96Bank Rakyat Indonesia 2.48 3.77

Top Ten Holdings of Underlying Fund As at 30 Jun 2015 % of NAV MV S$ mil

Ezion Holdings 4.17 8.11Samsung Electronics Co Ltd 4.07 7.91Industrial and Commercial Bank of China H Shares 3.58 6.97China Everbright Ltd 3.26 6.34Sun Hung Kai Properties Ltd 3.13 6.08Hyundai Motor Co 2.76 5.36Ping An Insurance (Group) Co of China Ltd H Shares 2.70 5.26Largan Precision Co Ltd 2.53 4.92LG Household & Health Care Ltd 2.51 4.88Bharat Forge Limited 2.41 4.68

V Exposure to Derivatives As at 30 Jun 2016 N.A.

VI Borrowings of Net Asset Value As at 30 Jun 2016 N.A.

*HBSC Insurance Asian Balanced Fund invests 30% into Legg Mason Western Asset Global Bond Trust.Please refer to HSBC Insurance Global Bond Fund on page 65 for the underlying fund disclosure on LeggMason Western Asset Global Bond Trust under Section C.

D) Other Disclosure Items I Expense/Turnover Ratios Expense Ratio Turnover Ratio

As at 31-Mar-16* As at 30-Jun-15 As at 31-Mar-16* As at 30-Jun-15Underlying Fund Level Legg Mason Western Asset Asian Enterprise Trust 1.67% 1.71% 89.54% 102.33%Legg Mason Western Asset Global Bond Trust 0.83% 0.88% 8.78% 221.82%

ILP Sub-Fund Level As at 30-Jun-16HSBC Insurance Asia Balanced Fund 1.68% 1.95% 8.08% 13.57%*Based on the unaudited figures as at 31 Mar 2016 as the expense ratios of Legg Mason Western Asset Asian Enterprise Trust and Legg Mason Western Asset Global Bond Trust for the financial year ended 30 Jun 2016 are not available.

II Related-Party Transactions N.A.

III Material Information that will adversely impact the valuation of the ILP sub-fund N.A.


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IV Soft Dollar Commission Agreement The Manager currently does not but shall be entitled to receive and enter into soft-dollarcommissions/arrangements in respect of the fund.

The sub-Manager currently receives and enters into soft-dollar commissions/arrangements in respect ofthe Fund. The Manager and Sub-Manager will comply with applicable regulatory and industry standardson soft-dollars. The soft-dollar commissions which the Sub-Manager receives and which the Managermay receive include include specific advice as to the advisability of dealing in, or the value of anyinvestments, research and advisory services, economic and political analyses, portfolio analysesincluding valuation and performance measurements, market analyses, data and quotation services,computer hardware and software or any other information facilities to the extent that they are used tosupport the investment decision making process, the giving of advice, or the conduct of research oranalysis, and custodial service in relation to the investments managed for clients.

Soft-dollar commissions received shall not include travel, accommodation, entertainment, generaladministrative goods and services, general office equipment or premises, membership fees, employees’salaries or direct money payment.

The Manager and Sub-Manager will not accept or enter into soft dollar cmmissions/arrangements unlesssuch soft-dollar commissions/arrangements would, in the opinion of the Manager or Sub-Manager (as thecase may be), assist it in its management of the Trust, provided that it shall ensure at all times that bestexecution is carried out for the transactions, and that no unnecessary trades are entered into in order toqualify for such soft-dollar commissions/arrangements.

E) Financial Statements Refer to page 144.

For more information, please contact your financial consultant, call our Customer Service Hotline on 6225 6111,

or visit our web site at www.insurance.hsbc.com.sg.

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Asia Equity Fund

14

HSBC Insurance Asia Equity Fund

Fund Objective

HSBC Insurance Asia Equity Fund seeks to achievecapital appreciation in the medium to long-term byinvesting in a diversified portfolio of Asia (ex-Japan)equity and equity-related securities (includingwarrants and convertible securities. Fundinvestments are made by way of a feeder fund,which invests substantially all or all its assets in theDeutsche Asia Premier Trust.


It has been a tumultuous 12-month period for Asianmarkets with only 2 markets ending on positivegains while all others returned negatively.

FUND FACTS Underlying Fund Deutsche Asia Premier Trust Fund Manager Deutsche Asset

Management (Asia) Limited Launch Date 31 Jan 1994 CPFIS/SRS* SRS CPFIS Risk Classification

N.A.


*Note: With effect from 28 Jun 2010, the Fund has been delisted from CPFIS.

All major markets suffered from the unexpected devaluation of Renminbi (RMB) in August 15 and the first US rate hike which saw Asian currency weakness across the board. Markets remained choppy into the start of2016 with depressed oil prices, causing more weakness in some Association Of Southeast Asian Nations (ASEAN) commodity-exporting countries. Pressures were not relieved as global markets went throughanother meltdown with the Brexit issue towards the end of June 16. The only 2 markets that ended positivelywere Indonesia on optimism of its tax amnesty and the Philippines amid hopes of the better outlook with thenewly minted President Duterte.


We believe the worst may be behind us and Asian markets may be in a sweet spot in the immediate term.With the Brexit issue, Asian markets are relatively better with political stability and attractive valuationsversus developed markets. There is also a possibility that QE may continue globally post Brexit, causingUSD weakness. A weak USD is generally positive for Asian markets. We are hopeful that a rally wouldcontinue and new money may be deployed into Asia following the Brexit outcome. We are overweight thePhilippines, Thailand and Korea. We narrowed our underweight in Taiwan and Singapore. We have added a basket of ASEAN properties due to more liquidity easing expectations.

^ Source: Deutsche Asset Management (Asia) Limited


3-Mth (%)

6-Mth (%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

Since Inception ̂

(%) HSBC Insurance Asia Equity Fund (0.24) (5.55) (17.39) 1.71 (1.11) 23.43 120.22 Benchmark* 0.12 (2.81) (12.27) 12.31 12.05 51.18 73.07 II Average Annual Compounded Returns

3-Year(%)

5-Year(%)

10-Year(%)

Since Inception ̂

(%) HSBC Insurance Asia Equity Fund 0.57 (0.22) 2.13 3.60 Benchmark* 3.95 2.30 4.22 2.49

*MSCI AC Far East ex Japan (TR) ^Inception Date: 16 Mar 1994


15


Deutsche Asia Premier Trust 100.05 87.61 Other assets 0.08 0.07 Other liabilities (0.13) (0.11)

Total 100.00 87.57


Subscription 14,398,698 Redemption 5,700,337

C) Underlying Fund Disclosure (Deutsche Asia Premier Trust) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

South Korea 21.32 21.47 China 15.89 16.00 Cayman Islands 14.71 14.81 Taiwan 12.92 13.01Hong Kong 11.12 11.20 Philippines 4.89 4.92 Thailand 4.39 4.42 Indonesia 3.80 3.83 Singapore 3.77 3.80 Others* 7.19 7.25

Total 100.00 100.71 *Includes other countries and net assets


Real Estate 10.30 10.37 Semiconductors 9.78 9.85 Insurance 8.78 8.84 Retail 7.14 7.19 Electrical/Electronics 6.99 7.04 Internet Services 6.72 6.77 Building Materials 5.67 5.71 Banks 5.20 5.24 Healthcare 3.05 3.07 Entertainment 3.02 3.04 Manufacturing 2.80 2.82 Others* 30.55 30.77

Total 100.00 100.71 *Includes other industries and net assets

III Allocation of Debt Securities by Credit Ratings As at 30 Jun 2016N.A.

IV Top Ten Holdings of Underlying Fund As at 30 Jun 2016% of NAV MV S$ mil

Tencent Holdings Limited 6.72 6.77 Taiwan Semiconductor Manufacturing Corporation Limited 6.34 6.39 Samsung Electronics Co Limited 6.23 6.27 AIA Group Limited 4.71 4.74 China Construction Bank H Shares 4.18 4.21 Ping An Insurance (Group) Company of China Limited H Shares 2.99 3.01 BGF Retail Company Limited 2.82 2.84 Petrochina Company Limited H Shares 2.68 2.70 China Mobile Limited 2.44 2.46 Cemex Holdings Philippines Inc 2.26 2.28


16

Top Ten Holdings of Underlying Fund As at 30 Jun 2015% of NAV MV S$ mil

Samsung Electronics Corporation Limited 6.11 6.87 Taiwan Semiconductor Manufacturing Corporation Limited 5.04 5.67 Tencent Holdings Limited 4.77 5.37 AIA Group Limited 3.39 3.82 China Construction Bank H Shares 2.97 3.34 Bank of China Limited H Shares 2.66 2.99 Largan Precision Company Limited 2.33 2.62 DBS Group Holdings Limited 2.28 2.57BGF Retail Company Limited 2.24 2.52 BOC Hong Kong Holdings Limited 2.07 2.33

V Exposure to Derivatives As at 30 Jun 2016% of NAV -Market Value (S$) -Realised gains / (Losses) (S$) (74,184)Unrealied Gains / (Losses) (S$) -

VI Borrowings of Net Asset Value As at 30 Jun 2016N.A.

D) Other Disclosure ItemsI Expense/Turnover Ratios HSBC Insurance Asia Equity Fund Underlying Fund

As at 30-Jun-16 As at 30-Jun-15 As at 31-Mar-16* As at 30-Jun-15 Expense Ratio 1.81% 1.86% 1.52% 1.55%

As at 30-Jun-16 Turnover Ratio 6.49% 9.45% 126.41% 196.29%

*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Deutsche Asia Premier Trustfor the financial year ended 30 Jun 2016 is not available.

II Related-Party TransactionsN.A.

III Material Information that will adversely impact the valuation of the ILP sub-fundN.A.

IV Soft Dollar Commission Arrangement Soft dollar commissions are benefits accorded to Manager by their brokers, usually in the form ofresearch, advisory, analysis and data services, computer hardware or software used for and/or in supportof the investment process.

The Manager’s policy on soft dollar commissions is as follows: - the goods and services received would assist in the provision of investment services and advices orrelated services to the unit trust; - transactions are executed on the best available terms; and - the Manager does not engage in unnecessary trades in order to qualify for soft dollar commissions.

Soft dollar commissions were received from the Manager’s panel of soft dollar brokers which executedtransactions for the unit trust and other funds managed by the Managers.

E) Financial StatementsRefer to page 144.

For more information, please contact your financial consultant,call our Customer Service Hotline on 6225 6111,


HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Asia Focused Income Fund

17


Fund Objective

HSBC Insurance Asia Focused Income Fund seeks to provide income and moderate capital growth through an active asset allocation in a diversified portfolio of fixed income and equity securities as well as money market and cash instruments. Fund investments are made by way of a feeder fund, which invests substantially all, or all its assets in the HSBC Global Investment Funds - Managed Solutions – Asia Focused Income Fund.


Global equities and Asia Pacific ex Japan equities both recorded a notable correction over the 1-yearperiod ending Jun 2016. Concerns over economic

FUND FACTS Underlying Sub-Fund HSBC Global Investment

Funds – Managed Solutions - Asia Focused Income Fund

Fund Manager HSBC Global Asset Management (Singapore) Limited

Launch Date 28 Jan 2013 CPFIS/SRS SRS CPFIS Risk Classification

N.A.


growth were the main driver of negative sentiment with weak oil and commodity prices taken as an indicationthat demand is weak globally. The Federal Reserve (FED) decided in December last year to increase ratesby 0.25%, the first hike since 2006. They were careful to prepare markets for the move and as a result therewas little reaction to the announcement. Risk appetite was supported at the end of the period by a raft ofbetter-than-expected data releases from China and further gains in oil prices. The last big news was the UK’s surprise decision to leave the EU in the 23 June referendum which resulted in a bout of financial marketvolatility.


We have decided against taking a more defensive asset allocation position following the UK’s decision toleave the EU. Although the decision to exit is negative for sentiment it is, at this stage, only the start of anuncertain process that will play out over a number of years and take a number of different turns along the way. With relative valuation signals between different asset classes quite strong, particularly following thefurther decline in bond yields, we retain our preference for equities and corporate bonds for the medium term.The quick rebound in risk assets in the last few days of the quarter suggest markets are taking a wait andsee approach to developments rather than immediately adopting a hard “risk off” view.

^ Source : HSBC Global Asset Management (Singapore) Limited


3-Mth(%)

6-Mth (%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Asia Focused Income Fund 2.98 6.25 1.70 10.09 N.A. N.A. 3.98


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Asia Focused Income Fund 3.26 N.A. N.A. 1.16

This fund has no benchmark. ^Inception Date: 06 Feb 2013


18


HSBC Global Investment Funds – Managed Solutions - Asia Focused Income Fund

100.90 1.12

Other liabilities (0.90) (0.01) Total 100.00 1.11



C) Underlying Sub-Fund Disclosure (HSBC Global Investment Funds – Managed Solutions - Asia Focused Income Fund)

I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

China 34.44 102.66 Hong Kong 13.43 40.03 United States 11.35 33.83 India 7.19 21.43 Indonesia 6.22 18.54 Korea, Republic of, (South Korea) 5.93 17.68 Singapore 5.86 17.47 Taiwan 5.46 16.28 Others* 8.73 26.01 Cash 1.39 4.15

Total 100.00 298.08 *Includes other countries


Asian investment grade bond 36.65 109.21 Asian high dividend equity 30.86 92.00 Asian high yield bond 10.18 30.34 GEM local debt 9.95 29.67 Global high yield bond 9.94 29.64 Japanese equity 1.03 3.07 Cash 1.39 4.15

Total 100.00 298.08

III Allocation of Debt Securities by Credit Ratings As at 30 Jun 2016 Rating % of NAV MV S$ mil

(For Debt securities portfolio only) AA+ 1.90 5.67 AA 0.41 1.21 AA- 0.23 0.69 A+ 4.67 13.93 A 3.79 11.31 A- 8.89 26.50 BBB+ 8.82 26.28 BBB 5.76 17.17 BBB- 12.74 37.97 BB+ 2.22 6.61 BB 3.89 11.61 BB- 2.40 7.16 B+ 4.42 13.17 Unrated 0.83 2.47 Others* 5.75 17.12

Total 66.72 198.87 *Includes lower rated debt securities


19

IV Top Ten Holdings of Underlying Sub-Fund As at 30 Jun 2016 % of NAV MV S$ mil

HSBC GIF Global Em Mkts Local Dbt ZD 9.95 29.67 HSBC GIF Global High Yield Bond ZC 9.94 29.64 Taiwan Semiconductor Mfg(2330) (RMT) Common NTD 10 (Barra) 2.10 6.25 SAMSUNG ELECTRONICS CO LTD 1.73 5.15 KT&G CORP 1.27 3.78 AIA GROUP LTD 1.19 3.55 China Mobile Ltd (941)(China) Ord HKD 0.10 1.11 3.30 SK TELECOM 1.07 3.20 HSBC GIF - Economic Scale Index Japan Equity - ZD Class (USD) 1.03 3.07 CNOOC FINANCE 2014 ULC 4.2500 30-APR-24 0.97 2.88

Top Ten Holdings of Underlying Sub-Fund As at 30 Jun 2015 % of NAV MV S$ mil

HSBC Global Investment Funds - GEM Local Debt 10.47 46.11 HSBC Global Investment Funds - Economic Scale Index Global Equity 10.11 44.50 Union Bank Of India HK 4.5% 28/10/19 1.45 6.39 China Construction Bank 1.24 5.44 China Mobile 1.20 5.29 National Australia Bank 1.12 4.94 Taiwan Semiconductor Manufacturing 1.08 4.77 Citic Pacific 6.625% 15/04/21 1.06 4.68 Coal India Ltd Pnote 04/08/16 (JP Morgan) 1.05 4.64 SK Telecom 1.04 4.59



D) Other Disclosure ItemsI Expense/Turnover Ratios HSBC Insurance Asia Focused

Income Fund Underlying Sub-Fund



*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of HSBC Global Investment Funds – Managed Solutions - Asia Focused Income Fund for the financial year ended 30 Jun 2016 is notavailable.

II Related-Party Transactions HSBC Insurance Asia Focused Income Fund S$1.12 million, equivalent to 100.90% of its net asset value in HSBC Global Investment Funds – Managed Solutions – Asia Focused Income Fund, which is managedby HSBC Global Asset Management (Singapore) Ltd.

The management fees earned by HSBC Global Asset Management (Singapore) Ltd from 01 July 2015 to30 June 2016 amounts to S$6,531.


IV Soft Dollar Commission Arrangement N.A.


20

E) Financial Statements Refer to page 144

For more information, please contact your financial planner, call our Customer Service Hotline on 6225 6111,


HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Asian Bond Fund

21

HSBC Insurance Asian Bond Fund

Fund Objective

HSBC Insurance Asian Bond Fund seeks to maximize returns over the long-term by investing mainly in the bond markets of Asia’s developing economies. There is no target industry or sector. Fund investments are by way of a feeder fund, which invests substantially all or all its assets in the Legg Mason Western Asset Asian Bond Trust.


The J.P. Morgan Asia Credit Index gained 1.77% month-over-month in June, bringing year-to-date

FUND FACTS Underlying Fund Legg Mason Western Asset

Asian Bond Trust Fund Manager Western Asset Management

Company Pte. Ltd. Launch Date 06 Oct 2008 CPFIS/SRS SRS CPFIS Risk Classification

N.A.


(YTD) gains to 6.54%. Returns were again driven by moves in US Treasuries (USTs), which delivered strongperformance towards the end of the month on the back of the UK’s Brexit vote, even as Asian credit spreads saw some widening. USTs rallied across the curve, with a cautious FED ahead of the Brexit referendum and the subsequent outcome of the vote causing a sharp risk-off rally.

Asia fixed-income markets will likely see outperformance versus other emerging markets on the back offurther weakness in global growth which will continue to exert pressure on commodity prices and commodityexporters.


There will continue to be limits to what monetary policy can accomplish in Asia, with unemployment seeing abottom and the challenge of finding jobs facing an increasing number of graduates in developed economiesin Asia. Accommodative monetary policy in a less-that-upbeat macroeconomic environment promptinvestment decisions that are likely to increase capital intensity and leverage for businesses. In developedAsia, for economies such as Hong Kong, Korea, Taiwan and Singapore, policymakers will continue to facethe challenge of a dislocation between economic growth and income growth, as the wage share of Grossdomestic product (GDP) continues to decline. Weak job markets and slow nominal wage growth will continueto exert deflationary pressures on these economies. Even as nominal growth continues at a moderate pace, accommodative policy and supportive structural economic policies might cause a decoupling of productivitygrowth and employment growth, as job creation slows in developed economies. This coupled with risingsocial costs due to aging demographics will make fiscal sustainability an increasing challenge forpolicymakers. This is not a problem unique to developed Asia, as the number of degree-level-qualified youths below the age of 34 in the Organisation for Economic Co-operation and Development and the G20 has grown nearly 45% between 2005 and 2013. Policymakers will have to focus on supply-side reforms, including improving infrastructure, increasing the size of the labour force and raising productivity. That said, with thelack of either supply-push or demand-pull inflation, monetary policy will continue to play a supportive role inproviding a stabilizing floor in a challenging economic environment.



3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Asian Bond Fund 1.34 2.58 3.23 10.38 18.62 N.A. 89.04 Benchmark* 0.30 0.67 1.59 2.64 3.44 N.A. 62.09


22


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Asian Bond Fund 3.35 3.47 N.A. 8.65 Benchmark* 0.87 0.68 N.A. 6.49

*US$ 3-month LIBOR (hedged to S$) ^Inception Date: 28 Oct 2008


Legg Mason Western Asset Asian Bond Trust 99.93 29.79 Other assets 0.07 0.02

Total 100.00 29.81



C) Underlying Fund Disclosure (Legg Mason Western Asset Asian Bond Trust) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

Singapore 24.56 10.28 Hong Kong 13.45 5.63 China 12.95 5.42 Indonesia 11.14 4.66 South Korea 9.75 4.08 India 8.96 3.75 Malaysia 3.27 1.37 Philippines 1.72 0.72 Others* 8.66 3.62 Cash 5.54 2.32



Financials 46.49 19.45 Government 11.59 4.85 Miscellaneous 10.01 4.19 Utilities 7.17 3.00 Real Estate 6.76 2.83 Energy 4.35 1.82 Telecommunication 3.70 1.55 Shipping & Transportation 3.08 1.29 Internet Services 1.31 0.55 Cash 5.54 2.32

Total 100.00 41.85


23


(For Debt securities portfolio only) AA- 4.06 1.70 A+ 9.15 3.83 A1 4.56 1.91 A 4.92 2.06 A- 1.31 0.55 A3 2.08 0.87 BBB+ 0.98 0.41 Baa1 2.29 0.96 BBB 5.04 2.11 Baa2 13.12 5.49 BBB- 5.57 2.33 Baa3 6.24 2.61 Unrated 17.06 7.14 Others* 18.08 7.56 Cash 5.54 2.32

Total 100.00 41.85 *Includes lower rated debt securities.

IV Top Ten Holdings of Underlying Fund As at 30 Jun 2016 % of NAV MV S$ mil

Indonesia Government Ser FR69 (Reg) 7.875% 15/04/2019 9.81 4.10 CK Bond Sec Ltd (Reg) 5.125% Perpetual 3.58 1.50 Overseas Chinese Banking Corp Ltd (Reg S) 3.15% 11/03/2023 3.58 1.50 Overseas Chinese Banking 4% Perpetual 3.03 1.27 NTPC Ltd Ser EMTN (Reg S) 4.375% 26/11/2024 2.56 1.07 DBS Bank Ltd Ser MTN (Reg S) (Br) Var 14/02/2023 2.41 1.01 Industrial & Commercial Bank of China Ser EMTN (Reg S) 3.5% 23/09/2016 2.39 1.00 Export-Import Bank Korea Ser EMTN (Reg S) 3.60% 10/06/2018 2.39 1.00 Hyflux Ltd (Reg S) Var Perpetual 2.37 0.99 Agri Bank of China Dubai Ser EMTN (Reg S() 3.5% 11/09/2017 2.17 0.91

Top Ten Holdings of Underlying Fund As at 30 Jun 2015 % of NAV MV S$ mil

Indonesia Government Ser FR 69 (Reg) 7.875% 15/04/20149 11.24 4.78 CK Bond Sec Ltd (Reg) 5.125% Perp 3.55 1.51 Oversea-Chinese Banking Corp Ltd (Reg S) 3.15% 11/03/2023 3.55 1.51 Oversea-Chinese Banking Corporation 4% Perp 2.99 1.27 Export-Import Bank Korea Ser EMTN (Reg S) 3.6% 10/06/2018 2.56 1.09 Industrial & Commercial Bank of China Ser EMTN (Reg S) 3.5% 23/09/2016 2.54 1.08 Standard Chartered Plc (Reg S) 2.625% 31/05/2016 2.54 1.08 Bank of East Asia Ltd Ser EMTN Var 13/09/2022 2.42 1.03 NTPC Ltd Ser EMTN (Reg S) 4.375% 26/11/2024 2.40 1.02 DBS Bank Ltd Ser MTN (Reg S) (Br) Var 14/02/2023 2.37 1.01

V Exposure to Derivatives As at 30 Jun 2016 % of NAV 0.96% Market value (S$) 399,735 Realised Gains / (Losses) (S$) -Unrealised Gains / (Losses) (S$) 399,735



24

D) Other Disclosure ItemsI Expense/Turnover Ratios HSBC Insurance Asian Bond

Fund Underlying Fund



*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Legg Mason Western AssetAsian Bond Trust for the financial year ended 30 Jun 2016 is not available.







HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Asian Dividend Equity Fund

25

HSBC Insurance Asian Dividend Equity Fund

Fund Objective

HSBC Insurance Asian Dividend Equity Fund seeksto achieve an above-benchmark dividend yield froma portfolio of Asian stocks with a focus on value andlong-term capital appreciation. Fund investments aremade by way of a feeder fund, which investssubstantially all or all its assets in the HendersonHorizon Fund - Asian Dividend Income Fund.


The bursting of the Mainland Chinese stock marketbubble, stronger USD and impending FED rate

FUND FACTS Underlying Sub-Fund Henderson Horizon Fund –

Asian Dividend Income Fund Fund Manager Henderson Global Investors

(Singapore) Limited Launch Date 26 May 2008 CPFIS/SRS SRS CPFIS Risk Classification

N.A.


hike, geo-political tensions and weaker exports and currencies in the region produced the perfect storm forAsian equities in the period under review. Asian currency moves were dramatic with some political concerncompounding the negative return especially in Malaysia and Indonesia. However the most talked about event was the US rate rise, which eventually took place at the end of the year but not without its own drama as thedeteriorating external outlook impacted an earlier planned rate rise. Emerging markets in general witnessedsignificant fund outflows in this environment, also exacerbated by monetary easing in Asia creating adivergence in policy versus the US.

Following the 25 basis point (BPS) rise in US interest rates in December global markets entered the newyear in jittery mood. The uncertainty was compounded by fears over the slowdown in Chinese growth, thefuture of the RMB and weakening oil and commodity prices resulting in one of the worst starts to a year forsome time. More dovish comments from the FED about future rate rises calmed the market in mid-February prompting a recovery which lasted until the end of the period under review.

The best performing markets were New Zealand, Philippines and Indonesia which all posted gains aided bypositive currency moves. The worst performing market was China which despite better than expected GDPgrowth numbers in the 1Q16, lower interest rates and a stabilisation of the RMB could not address the damage done by the bursting of the mainland share bubble and doubts about the communistparty’sacommitmentAtoAreform.


At the sector level, despite a rally towards the end of the period, the energy and materials sectors lagged asprogress made in addressing oversupply was thwarted by downgrades to demand. Financials were the othernotable laggards with banks in particular hit by the continued fall in interest rates and the renewed concernabout European banks which resurfaced in the first few months of 2016. Defensive sectors were the mostresilient with healthcare and utilities actually posting positive returns as investors found comfort in earningscertainty.

The outlook for Asia remains one of long-term attractive growth, structural reform and compelling valuationsbut higher volatility led by global political uncertainty, falling growth expectations and an uncertain interestrate environment will dictate market direction in the short-term. China concerns of hard-landing and one-offcurrency devaluation are overdone, whilst the macroeconomic data remains weak and structural issues remain, the fundamentals are significantly more stable than volatility in the market would suggest - this creates interesting investment opportunities in the region. Our disciplined investment process continues touncover companies with strong valuation support and operating performance alongside the potential forstrong dividend growth, which is a valuable commodity in the current environment.

^ Source: Henderson Global Investors (Singapore) Limited


26


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Asian Dividend Equity Fund 0.63 (3.06) (10.66) 4.01 14.99 N.A. 11.25

Benchmark* 0.41 (2.89) (10.21) 11.79 10.77 N.A. 10.14


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Asian Dividend Equity Fund 1.32 2.83 N.A. 1.33 Benchmark* 3.78 2.07 N.A. 1.20

*MSCI All Countries Asia Pacific ex Japan Index ^Inception Date: 02 Jun 2008

B) Fund Disclosure I Allocation by Asset Class As at 30 Jun 2016

Asset Class % of NAV MV S$ mil Henderson Horizon Fund - Asian Dividend Income Fund 100.00 3.00

Total 100.00 3.00



C) Underlying Sub-Fund Disclosure (Henderson Horizon Fund - Asian Dividend Income Fund) I Allocation by Country As at 30 Jun 2016

Country % of NAV MV S$ milAustralia 21.03 91.32

China 14.04 60.98 Taiwan 12.87 55.90 Singapore 11.75 51.03 South Korea 10.87 47.22 Hong Kong 8.91 38.70 India 6.18 26.85 Thailand 5.08 22.08 Others* 5.36 23.20 Cash 3.91 16.99


II Allocation by Industry As at 30 Jun 2016Industry % of NAV MV S$ mil

Financials 25.70 111.59 Telecommunication Services 20.97 91.06 Information Technology 13.32 57.84 Utilities 11.90 51.69 Industrials 10.43 45.31 Energy 6.12 26.56 Consumer Discretionary 5.58 24.24 Materials 2.10 9.13 Others* (0.03) (0.14) Cash 3.91 16.99

Total 100.00 434.27 *Includes other industries


27


IV Top Ten Holdings of Underlying Sub-Fund As at 30 Jun 2016% of NAV MV S$ mil

NetEase 3.05 13.30 Macquarie Korea Infrastructure Fund 3.01 13.09 Taiwan Semiconductor Manufacturing 2.82 12.24 CapitaLand Mall Trust 2.80 12.14 Telekomunikasi Indonesia Persero 2.73 11.84 Mapletree Greater China Commercial Trust 2.70 11.71 HKT Trust & HKT 2.65 11.51 Spark New Zealand 2.65 11.50

Ascendas Real Estate Investment Trust 2.56 11.12 Scentre Group 2.47 10.74

Top Ten Holdings of Underlying Sub-Fund As at 30 Jun 2015% of NAV MV S$ mil

Bharti Infratel 2.89 14.00 Gree Electric Appliances Inc of Zhuhai 2.63 12.75 Casetek 2.62 12.71

Agricultural Bank of China 2.51 12.20 Taiwan Semiconductor Manufacturing 2.46 11.93 Coal India 2.45 11.89 CapitaLand Mall Trust 2.44 11.84 Yuanta Financial 2.37 11.50 Macquarie Korea Infrastructure Fund 2.37 11.50 Vanguard International Semiconductor 2.36 11.45

V Exposure to Derivatives As at 30 Jun 2016% of NAV (0.03%)Market value (S$) (135,111)Realised Gains / (Losses) (S$) -Unrealised Gains / (Losses) (S$) -


D) Other Disclosure ItemsI Expense/Turnover Ratios HSBC Insurance Asian Dividend

Equity Fund Underlying Sub-Fund

As at 30-Jun-16 As at 30-Jun-15 As at 31-Dec-15* As at 30-Jun-15 Expense Ratio 2.20% 2.20% 1.90% 1.88% As at 30-Jun-16 Turnover Ratio 4.16% 7.36% 122.96%** 136.75%***

*Based on the unaudited figures as at 31 Dec 2015 as the expense ratio of Henderson Horizon Fund- Asian Dividend Income Fund for the financial year ended 30 Jun 2016 is not available. **Turnover Ratio calculation is based on Swiss Funds and Asset Management Association ***Turnover Ratio calculation is based on Luxembourg GAAP.




28

IV Soft Dollar Commission Arrangement The Investment Manager is authorised to effect transactions through brokers whereby the broker agrees to use a proportion of the commission earned on such transactions to discharge the broker's own costs or the costs of third parties in providing certain services to the Investment Manager. The services which can be paid for under such arrangements are those permitted under the rules of the Financial Conduct Authority ("FCA") namely those that relate to the execution of transactions on behalf of customers or the provision of investment research to the Investment Manager.




HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance China Balanced Fund

29

HSBC Insurance China Balanced Fund

Fund Objective

HSBC Insurance China Balanced Fund seeks to achieve capital appreciation in the long-term by investing 70% of its assets into a diversified portfolio of equity and equity-related securities in China including Hong Kong and 30% of its remaining assets into quality investment grade bonds ofSingapore and major bond markets. The Fund invests substantially all or all its assets primarily 70% into the Deutsche China Equity Fund and 30% into the Deutsche Lion Bond Fund.

Deutsche Premier Investment Funds - Deutsche China Equity Fund

FUND FACTS Underlying Sub-Funds 70%: Deutsche Premier

Investment Funds - Deutsche China Equity Fund 30%: Deutsche Lion Bond Fund

Fund Manager Deutsche Asset Management (Asia) Limited

Launch Date 26 May 2008 CPFIS/SRS SRS CPFIS Risk Classification

N.A.



MSCI China tumbled during the review period as sentiment was hurt by the sharp correction in A-Share market in the middle of 2015. Concerns on weaker economic growth as well as the depreciation of RMB alsoweighed on market sentiment. However, the market was gradually stabilizing and recovering in 2Q16, thanks mainly to lower expectations on the US rate hike as well as the Chinese government’s efforts to boosteconomic growth through monetary easing and fiscal stimulus. During the review period, MSCI China fell23%. Macro-driven sectors like financials, industrials, materials and consumer discretionary underperformed. Defensive and growth sectors like telecom, health care and information technology (IT) outperformed.


We expect 2016 GDP growth to slow to around 6.5% year-on-year from 6.9% year-on-year in 2015, which is within the government’s target. The slowdown is partly due to the lack of bull-run in A-Share market in 2016. The government has been pushing for more State Owned Enterprise reforms, tightened regulations in thefinancial system to control risk, as well as carried out the supply-side reform to reduce excess capacities. Wethink the government is doing the right thing to make the economy more efficient and sustainable in the long-term, despite some short-term slowdown. MSCI China’s YTD performance lags most emerging equitymarkets and the valuations are at the low-end of the historical range. We remain positive on infrastructure-related stocks, supply-side reform beneficiaries (e.g. steel and coal) as well as secular growth sectors suchas e-commerce and health care. Deutsche Lion Bond Fund

*Please refer to HSBC Insurance Singapore Bond Fund on page 120 for the Investment and Market Review and the Market Outlook and Investment Strategy.



3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance China Balanced Fund (0.17) (7.33) (19.01) 10.99 1.12 N.A. 3.75 Benchmark* 0.25 (6.44) (15.97) 13.17 6.58 N.A. 10.26


30


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance China Balanced Fund 3.54 0.22 N.A. 0.46 Benchmark* 4.21 1.28 N.A. 1.22

*70% MSCI China Total Return Index, with Gross Dividends reinvested and 30% 6-month SingaporeInter-bank Offer Rate (SIBOR) minus 12.5 basis points ^Inception Date: 02 Jun 2008


Asset Class % of NAV MV S$ mil Deutsche Premier Investments Fund – Deutsche China Equity Fund 68.46 1.78 Deutsche Lion Bond Fund 31.92 0.83 Other liabilities (0.38) (0.01)

Total 100.00 2.60



C) Underlying Sub-Fund Disclosure (Deutsche Premier Investment Funds – Deutsche China Equity Fund)

I Allocation by Country As at 30 Jun 2016Country % of NAV MV S$ mil

China 39.10 113.96 Cayman Islands 36.88 107.48 Hong Kong 17.39 50.68 Bermuda 3.95 11.52 Other net assets 2.68 7.79

Total 100.00 291.43


Banks 14.77 43.04 Telecom Service 11.30 32.94 Internet Service 11.06 32.22 E-Commerce 10.82 31.52 Real Estate 6.52 19.00 Oil & Gas 5.18 15.11 Insurance 4.95 14.44 Computer/Software 3.64 10.61 Electrical/Electronics 3.23 9.41 Pharmaceuticals 2.97 8.67 Engineering/Construction 2.26 6.58 Others* 23.30 67.89

Total 100.00 291.43 *Includes other industries and other net assets



31


Tencent Holdings Limited 9.85 28.71 China Mobile Limited 8.52 24.84

Alibaba Group Holding Limited 8.18 23.83 China Construction Bank H Shares 5.05 14.71 Industrial and Commercial Bank of China H Shares 4.86 14.17 Bank of China Limited H Shares 3.39 9.87 China Overseas Land & Investment Limited 3.12 9.08 China Petroleum & Chemical Corporation Limited H Shares 3.11 9.05 China Unicom (Hong Kong) Limited 2.78 8.11 Ping An Insurance (Group) Company of China Limited H Shares 2.34 6.81


Tencent Holdings Limited 8.58 37.14 China Construction Bank H Shares 5.98 25.89 Bank of China Limited H Shares 5.31 22.97 Industrial and Commercial Bank of China H Shares 4.74 20.53 Ping An Insurance (Group) Company of China Limited H Shares 4.04 17.48 BBMG Corporation H Shares 2.94 12.73 China Mobile Limited 2.91 12.61 China Life Insurance Company Limited H Shares 2.87 12.44 China Petroleum & Chemical Corporation Limited H Shares 2.75 11.92 Citic Securities Company Limited H Shares 2.36 10.23

V Exposure to Derivatives As at 30 Jun 2016% of NAV -Market value (S$) -Realised Gains / Losses (S$) (38,003)Unrealised Gains / Losses (S$) -


*HBSC Insurance China Balanced Fund invests 30% into Deutsche Lion Bond Fund. Please refer toHSBC Insurance Singapore Bond Fund on page 121 for the underlying fund disclosure on Deutsche LionBond Fund under Section C.


As at 31-Mar-16* As at 30-Jun-15 As at 30-Jun-16 As at 30-Jun-15Underlying Sub-Fund Level

Deutsche China Equity Fund 1.68% 1.72% 113.74% 118.81% Deutsche Lion Bond Fund 0.69% 0.68% 38.31% 33.86%

ILP Sub-Fund Level As at 30-Jun-16HSBC Insurance China Balanced Fund 1.59% 1.60% 9.26% 17.58%*Based on the unaudited figures as at 31 Mar 2016 as the expense ratios of Deutsche Premier Investments Fund- China Equity Fund and Deutsche Lion Bond Fund for the financial year ended 30 Jun 2016 are not available.

II Related-Party Transactions N.A. III Material Information that will adversely impact the valuation of the ILP sub-fund N.A.


32

IV Soft Dollar Commission AgreementSoft dollar commissions are benefits accorded to Manager by their brokers, usually in the form of research, advisory, analysis and data services, computer hardware or software used for and/or in support of the investment process.

The Manager’s policy on soft dollar commissions is as follows: - the goods and services received would assist in the provision of investment services and advices or related services to the unit trust; - transactions are executed on the best available terms; and - the Manager does not engage in unnecessary trades in order to qualify for soft dollar commissions.

Soft dollar commissions were received from the Manager’s panel of soft dollar brokers which executed transactions for the unit trust and other funds managed by the Managers.




HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance China Equity Fund

33

HSBC Insurance China Equity Fund

Fund Objective

HSBC Insurance China Equity Fund seeks to provide capital growth primarily through investment in equity and equity related securities of companies which are headquartered in and/or listed in or have a substantial business exposure to the People’s Republic of China (“China”). Fund investments are made by way of a feeder fund through the Underlying Sub-Fund, Schroder China Opportunities Fund.


Chinese and Hong Kong equities fell sharply in the 3Q15 as further tightening measures on margin financing by brokerages, the volatility in Chinese markets, and slowing growth in the world’s second largest economy led to a global selloff. In the 4Q15, Chinese equities gained as late October saw another

FUND FACTS Underlying Sub-Fund Schroder International

Opportunities Portfolio - Schroder China Opportunities Fund

Fund Manager Schroder Investment Management (Singapore) Ltd

Launch Date 13 Nov 2003 CPFIS/SRS OA/SRS CPFIS Risk Classification

Higher Risk - Narrowly Focused – Country – Greater China

As at 30 Jun 2016 Offer Price S$ 1.92411 Bid Price S$ 1.82790 Fund Size S$ 85.75 mil Units in Issue 46.91 mil *Note: With effect from 31 Aug 2016, the Fund has been dislisted from CPFIS

interest rate cut by the People’s Bank of China (PBoC), the sixth such cut in a year. Meanwhile, Hong Kongstocks saw positive returns on the back of hopes of further stimulus measures in China. Both markets ended the 1h16 in negative territory on concerns over sluggish fundamentals in the Chineseeconomy, capital flight on the back of a weak Chinese yuan, the US interest rate trajectory and weak oilprices. Sentiment swung on Brexit-related worries in June and markets gained ground towards the end ofsecond quarter on expectations that the FED would delay its planned rise in interest rates, following the “Leave” victory.

The fund delivered negative returns but outperformed the benchmark over the period. Positive stockselection in consumer discretionary, IT and materials were the key contributors, although this was partiallyoffset by negative stock selection in industrials and utilities.


In the short-term, post-Brexit, the negative factors for equity markets have been offset largely by expectationsfor renewed monetary easing by central banks around the world, with government bond yields plunging tonew lows in many countries. Lower bond yields are encouraging money back into defensive equity yieldplays again and this has helped restore some calm to markets, with greater volatility being seen in currencies recently. Current market consensus is quite negative on China with most funds underweight China and emergingmarkets, which actually creates good buying opportunities for longer term investors. Furthermore, diminishingexpectation of further US rate hikes, a bottoming out of the oil price, coupled with valuation support, shouldprovide some trigger for market recovery in the medium term. Where we have seen the greatest progress has been in financial market liberalisation. The RMB currency recent inclusion in the Special Drawing Rights basket is a notable milestone for the RMB’sinternationalization We have also selectively invested in companies that can benefit from supportive government policies,including railway equipment stocks. We have recently added to select material stocks on expectations thatcommodity prices are showing signs of bottoming out. On the other hand, we have reduced our exposure tothe healthcare sector on concerns of rising policy headwinds as well. Against the market backdrop of sluggish economic growth and anaemic earnings, the importance of bottom-up stock selection becomes even more imperative. We remain focused on investing in companies that havesustainable business models and strong cash flows.

^ Source: Schroder Investment Management (Singapore) Ltd


34


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance China Equity Fund 0.11 (8.52) (18.32) 25.57 13.24 38.48 92.41 Benchmark* 0.06 (9.58) (23.41) 17.20 6.94 N.A. N.A.**


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance China Equity Fund 7.89 2.52 3.31 5.34 Benchmark* 5.43 1.35 N.A. N.A.**

* Benchmark Details: Inception to February 2009 – MSCI China Index From February 2009 to March 2011 – MSCI China 10/40 Capped Net Index From March 2011 to April 2013 – MSCI TR China Gross From April 2013 onwards – MSCI TR China Net ** MSCI TR China Net was benchmark since April 2013, previous benchmark was MSCI China Index performance of composit Index is unavailable from 08 December 2003. ^Inception Date: 08 Dec 2003


Schroder International Opportunities Portfolio - Schroder China Opportunities Fund 99.98 85.73Other assets 0.29 0.25Other liabilities (0.27) (0.23)

Total 100.00 85.75

II Fund Movement (01 Jul 2015 - 30 Jun 2016)S$

Subscription 11,990,881Redemption 7,394,188

C) Underlying Sub-Fund Disclosure (Schroder International Opportunities Portfolio - Schroder China Opportunities Fund)


Luxembourg 99.02 97.01Other net assets/(liabilities) 0.98 0.96

Total 100.00 97.97*HSBC Insurance China Equity Fund feeds wholly into Schroder China Opportunities Fund (a feeder fund investing into a corresponding sub-fund in the Schroder International Selection Fund (ISF), an open-ended investment company corporated in Luxembourg).

II Allocation by Industry As at 30 Jun 2016N.A. (The fund invests wholly into an underlying collective investment scheme.)



35

IV Top Ten Holdings of Underlying Sub-Fund* As at 30 Jun 2016% of NAV MV S$ mil

Schroder International Selection Fund – China Opportunities C Accumulation Share Class 99.02 97.01

Top Ten Holdings of Underlying Sub-Fund* As at 30 Jun 2015% of NAV MV S$ mil

Schroder International Selection Fund - China Opportunities C Accumulation Share Class 99.39 113.26

*The rest of the holdings of the underlying sub-fund are cash-in-transits and accruals.

V Exposure to Derivatives As at 30 Jun 2016% of NAV -Market value (S$) -Realised Gains / (Losses) (S$) (14,063)Unrealised Gains / (Losses) (S$) -


D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance China Equity

Fund Underlying Sub-fund



*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Schroder International Opportunities Portfolio - Schroder China Opportunities Fund for the financial year ended 30 Jun 2016 is not available.



IV Soft Dollar Commission Arrangement The Fund invests substantially into the Schroder International Selection Fund China Opportunities. In the management of the underlying fund, the manager may accept soft dollar commissions from, or enter into soft dollar arrangements with, stockbrokers who execute trades on behalf of the underlying fund and the soft dollars received are restricted to the following kinds of services:

(i) research, analysis or price information; (ii) performance measurement; (iii) portfolio valuations; and (iv) administration services.

In the management of the Fund, the Manager currently does not receive or enter into any soft dollarcommissions or arrangements.




HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Chinese Equity Fund

36

HSBC Insurance Chinese Equity Fund

Fund Objective

HSBC Insurance Chinese Equity Fund seeks long-term capital growth mainly through a diversified portfolio of investments in equity and equity equivalent securities of companies listed on a major stock exchange or other regulated market of the People’s Republic of China (“China”), including Hong Kong SAR, as well as companies which carry out a preponderant part of their business activities in China. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the HSBC Global Investment Funds – Chinese Equity.


Funds – Chinese Equity Fund. Fund Manager HSBC Global Asset

Management (Singapore) Limited


N.A.

As at 30 Jun 2016 Offer Price S$ 1.01314 Bid Price S$ - Fund Size S$ 0.16 mil Units in Issue 0.16 mil


Offshore Chinese equities plummeted amid volatility over the 12-month period, with the MSCI China 10/40 Net index posting a plunge of 24.0% in USD terms. Market endured an extremely level of volatility in July last year, mainly driven by the correction in the onshore space on the back of tighter margin financing rules, stop-loss limits forcing margin calls and unwinding of leveraged positions, suspension of stock trading and worries over initial public offerings diverting liquidity from existing stocks. While January saw another round of sell-off due to the on-and-off circuit breaker, volatility in the RMB and concerns over China's economic momentum, market rebounded on continuous policy support, a stabilising RMB trend and as economic indicators started to point to a more stabilised economic growth picture in the near term.

The Fund lost ground in absolute terms, but outperformed the market driven by a combination of sector allocation and stock selection. The overweight in IT and underweight in utilities contributed positively. Meanwhile, stock selection in IT and consumer discretionary was the standout.


Focusing on China, the potential delays of FED rate hike will likely help stabilise the movement of the RMB. Meanwhile, proactive fiscal policy expansion accompanied by the implementation of reforms such as on the supply side and further opening up of its capital/financial markets should be supportive of the market.

Valuation for MSCI China index now sits at an attractive level of 1.3x 2016 price-to-book, which is around 1 standard deviation lower than its 10-year average of 1.9x.

While markets may be impacted by the swing in sentiment in the short-term, valuation is an important factor that we will closely monitor and may add to companies with good fundamentals when attractive buying opportunities present. In terms of sectors, we continue to be positive on the auto sector, mainly at companies with a strong product pipeline focusing on the Sports Utility Vehicle (SUV) segment, as SUV sales in China continue to gain momentum. We believe that companies in a favourable product cycle will likely deliver strong earnings. We also maintain our positive view on the material sector, as we think earnings/margin bottoming out on the back of improving supply and demand situation, as well as attractive valuations will likely drive a relatively favourable outlook.

^ Source: HSBC Global Asset Management (Singapore) Limited


37


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Chinese Equity Fund 0.55 N.A. N.A. N.A. N.A. N.A. 1.31 Benchmark* (0.11) N.A. N.A. N.A. N.A. N.A. 3.48

*MSCI China (10/40) Capped Net Index ^Inception Date: 25 Jan 2016


Asset Class % of NAV MV S$ mil HSBC Global Investment Funds – Chinese Equity (AD) 100.00 0.16

Total 100.00 0.16

II Fund Movement (18 Jan 2016 - 30 Jun 2016)S$

Subscription 157,483 Redemption 436

C) Underlying Sub-Fund Disclosure (HSBC Global Investment Funds – Chinese Equity AD) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil Hong Kong 91.69 1752.32 China 0.82 15.74 Others* 5.01 95.83 Cash 2.48 47.40

Total 100.00 1,911.29 *Includes other countries

II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil Financials 29.37 561.34 Information Technology 25.07 479.16 Telecommunication Services 10.37 198.20 Consumer Discretionary 9.46 180.81 Energy 9.26 176.99 Industrials 5.29 101.11 Materials 3.66 69.95 Others* 5.04 96.33 Cash 2.48 47.40

Total 100.00 1,911.29 *Includes other industries



38


Tencent Holdings Ltd 9.8 187.31 China Mobile Ltd (941)(China) Ord Hkd 0.10 9.2 175.84

Alibaba Group Holding Ltd 8.68 165.90 China Construction Bank (939) Class 'H' Rmb 1.00 (China) 7.48 142.96 Industrial & Commercial Bk Of China 'H' Cny 1.00 (1398) (China) 4.06 77.60 China Petroleum And Chem (386) Class 'H' Rmb 1.00 (Cn) 3.73 71.29 China Overseas Land & Investment (688) Ordinary Hkd 0.10 (China) 3.63 69.38 Ping An Insurance Co Ltd Ord Cny 1 (2318) (China) 3.44 65.75 Cnooc Ltd (883) (China) Ordinary Hkd 0.02 2.95 56.38 Bank Of China (3988) Class 'H' (China) 2.94 56.19



D) Other Disclosure Items I Expense/Turnover

Ratios HSBC Insurance Chinese Equity

Fund Underlying Sub-Fund

As at 30-Jun-16 As at 31-Mar-16* Expense Ratio 1.90% 1.91%

As at 30-Jun-16 Turnover Ratio 218.79% 1.05% *Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of HSBC Global Investment Funds – Chinese Equity (AD) for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions HSBC Insurance Chinese Equity Fund S$0.16 million, equivalent to 100% of its net asset value in HSBC Global Investment Funds – Chinese Equity, which is managed by HSBC Global Asset Management (Singapore) Ltd.

The management fees earned by HSBC Global Asset Management (Singapore) Ltd from 01 July 2015 to 30 June 2016 amounts to S$228.


IV Soft Dollar Commission Agreement N.A.


For more information, please contact your financial consultant, call our Customer Service Hotline on 6225 6111, or visit our web site at www.insurance.hsbc.com.sg.

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Climate Change Equity Fund

39

HSBC Insurance Climate Change Equity Fund

Fund Objective

HSBC Insurance Climate Change Equity Fundsseeks to provide capital growth primarily throughinvestment in equity securities of worldwide issuerswhich will benefit from efforts to accommodate orlimit the impact of global climate change. Fundinvestments are made by way of a feeder fund,which invests substantially all or all of its assets inthe Schroder International Selection Fund GlobalClimate Change Equity.

Investment and Market Review ^ Global equity markets lost ground over the 12-month period. The 2H16 saw some dramatic


Selection Fund - Global Climate Change Equity


Launch Date 06 Oct 2008 CPFIS/SRS SRS CPFIS Risk Classification

N.A.


selloffs amid instability in the Chinese equity market, concerns about global growth, a much-anticipated rise in US interest rates and falling commodity prices. Markets recovered somewhat in 2016, although have notquite made back last year’s losses. Rising commodity prices have reduced concerns about global deflation,and global central bank policy remains very accommodative. The UK’s surprise vote to leave the EU at theend of June put a dampener on equity market performance. Against this backdrop, the more defensive sectors outperformed with consumer staples, telecoms and utilities the top performing areas of the market,reflecting an apparent appetite for lower perceived earnings risk and volatility.

Over the 12-month period the fund underperformed its benchmark with stock selection in industrials being the primary detractor. Our overweight position to the sector served to offset this to some extent though, as didour lack of exposure to financials. By region, we gained the most in Japan, thanks to strong selection, although our underweight position to North America as well as our stock selection within the region detracted.From a stock perspective, commercial lighting designer Zumtobel weighed the most on returns. Some of oursolar-related holdings also struggled over the year, including Canadian Solar and SolarCity. On the positiveside, e-commerce giant Amazon contributed the most to returns due to a combination of robust earnings and improving disclosure and government. Brazilian hydroelectricity producer AES Tiete was another top performer.


Equities continue to be buffeted by macroeconomic and political factors. In particular, concerns about Brexit, a “hard landing” for China’s economy, global deflationary forces, the rise of anti-trade sentiment, and the difficulties of so many traditional political establishments around the world have created a challengingenvironment for financial markets. Ultimately though, extreme market pessimism will result in the potential forattractive risk-adjusted returns for long-term investors. We are confident that we will be rewarded for oursteadfast focus on identifying opportunities for earnings growth in a market that is both fearful andexcessively focused on the short-term. The growth outlook for climate change themes remains strong and webelieve the returns on energy efficiency investments continue to be the most compelling in the short run. We also find a number of good opportunities among online retailers where they incur a substantially reducedcarbon footprint in terms of operations and distribution compared to traditional retailers. We continue toexpect rapid adoption of renewable energy practices worldwide, particularly in solar but also in wind, wheretechnological gains are helping make installation more affordable. We have selective exposure to higherquality investments in these areas, mindful of inherent industry volatility. However, we are encouraged byrecent developments in the US and China to extend the subsidy regimes for both of these primary renewablepower sources.

Finally, we have increased our exposure to environmental resources via agriculture-related stocks in particular. After two years of excess inventories and declining crop prices, we expect that farm incomes arenearing a floor and that the sector has become more appealing again.



40


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Climate Change Equity Fund (2.24) (8.12) (6.70) 19.19 28.42 N.A. 72.90

Benchmark* 0.96 (4.51) (2.82) 29.81 51.11 N.A. 92.45


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Climate Change Equity Fund 6.03 5.13 N.A. 7.38 Benchmark* 9.09 8.61 N.A. 8.89

*MSCI World Net (SGD) ^Inception Date: 23 Oct 2008


Schroder International Selection Fund - Global Climate Change Equity 100.00 2.51 Total 100.00 2.51


Subscription 688,744Redemption 226,601

C) Underlying Sub-Fund Disclosure (Schroder International Selection Fund - Global Climate Change Equity)


United States 43.74 121.67 Japan 11.19 31.13 Germany 7.70 21.42 China 4.73 13.16 South Korea 3.82 10.63 United Kingdom 3.32 9.24 France 2.83 7.87 Australia 2.68 7.45 Others* 18.60 51.73 Liquid Assets 1.39 3.87



Industrials 34.29 95.39 Information Technology 18.30 50.90 Consumer Discretionary 17.96 49.96 Materials 10.85 30.18 Utilities 9.17 25.51 Financials 4.20 11.68 Health Care 2.96 8.23 Consumer Staples 0.88 2.45 Liquid Assets 1.39 3.87

Total 100.00 278.17


41



Amazon.com 3.77 10.49 Danaher 3.29 9.15 Lowe's Companies 3.00 8.35 NextEra Energy 2.99 8.32 Brambles 2.68 7.45 Alphabet 2.67 7.43 Ball 2.58 7.18 Hexagon 2.54 7.07 Samsung Electronics 2.25 6.26 Weyerhaeuser 2.17 6.04


Daikin Industries 3.75 9.86 Tractor Supply 3.32 8.73 Hexagon 3.09 8.13 Sekisui House 3.01 7.92 Amazon.com 2.59 6.81 Hexcel 2.48 6.52 Trimble Navigation 2.47 6.50 Danaher 2.42 6.37 Seven & I Holdings 2.33 6.13 Continental 2.32 6.10

V Exposure to Derivatives As at 30 Jun 2016% of NAV (0.20%)Market value (S$) (557,278)Realised Gains / (Losses) (S$) 57,282Unrealised Gains / (Losses) (S$) (557,278)


D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Climate Change




* Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Schroder International Selection Fund - Global Climate Change Equity for the financial year ended 30 Jun 2016 is not available.




42

IV Soft Dollar Commission Arrangement Each Investment Manager may enter into soft commission arrangements only where there is a direct andidentifiable benefit to the clients of the Investment Manager, including the relevant Sub-Fund, and where the Investment Manager is satisfied that the transactions generating the soft commissions are made ingood faith, in strict compliance with applicable regulatory requirements and in the best interests of therelevant Sub-Fund. Any such arrangements must be made by the Investment Manager on termscommensurate with best market practice.



HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Emerging Europe Equity Fund

43

HSBC Insurance Emerging Europe Equity Fund

Fund Objective

HSBC Insurance Emerging Europe Equity Fund seeks to provide capital growth and income primarily through investment in equity securities ofCentral and Eastern European companies including the markets of the former Soviet Union and the Mediterranean emerging markets. The portfolio may, to a limited extent, seek exposure to the markets of Northern Africa and the Middle East. Fund investments are made by way of a feederfund, which invests substantially all or all of its assets in the Schroder International Selection Fund Emerging Europe.


Selection Fund - Emerging Europe



N.A.



Global equities fell over the 12-month period. The 2H15 was beset by high volatility, with concerns overglobal growth and weakness in China. In this environment energy and commodity prices fell heavily. Aftermuch anticipation the FED hiked rates by 25BPS in December. However, expectations for further increaseshave been deferred due to renewed uncertainty over the outlook for global growth, in particular following theBrexit referendum result. Persistently below target inflation in the eurozone led the European Central Bank(ECB) to launch further stimulus in March. Global equities have recovered somewhat in 2016, but have notquite recouped last year’s losses. In emerging Europe, weak energy prices weighed on the Russian marketin particular whilst Brexit concerns hit Central European markets towards the end of the period. The MSCIEurope 10/40 index posted a negative return but slightly outperformed the MSCI Emerging Markets index.

Amid high volatility, Greece was the weakest index market. A third bailout was agreed and despite delaysand protracted negotiations, the country passed the first review. However, capital controls led to a sizeablebank recapitalisation. Brexit concerns are limited in trade terms but the country is effectively dependent onthe eurozone for funding so remains sensitive to wider eurozone risks.The fund outperformed the benchmarkby a wide margin over the 12-month period to the end of June 2016.

Country allocation was positive but stock selection accounted for the majority of outperformance. From acountry perspective, the off-benchmark allocation to Georgia added the most to returns. The underweights toPoland and Greece also proved beneficial.


The UK only represents around 4% of global GDP and consequently the decision to leave the EU, and therelated anticipated negative impact on investment, trade and economic growth, is not significant enough toderail global growth. Schroders’ economics team have marginally lowered their GDP forecast for the US andthe Eurozone by 0.1% respectively but their overall 2016 global GDP forecast remains unchanged at 2.5%.Brexit, however, has elevated tail risks. The UK is not the only Eurosceptic nation in the EU and with severalelections for core European markets scheduled over the next 12 months, there are concerns the result maygalvanise further nationalistic support. This risk is not limited to Europe, with US presidential elections taking place later this year. Alternatively, the result may help to unify Europe, trigger further policy stimulus andstructural reform. Whatever the outcome, the process will likely be slow and bumpy and hence clouds theoutlook for Europe. Given this backdrop, the next US rate hike is anticipated to be deferred to the end of theyear at the earliest. On a market implied basis the next one is not forecast until 2018.

Poland remains our largest underweight. Valuations are attractive and the economy remains firm, but there are major concerns over policy and governance. Furthermore, Poland stands out as particularly vulnerable toBrexit, given a high percentage of exports to the UK, a significant percentage of EU funds at stake and alabour market with relatively strong ties to the UK. The fund maintains off-benchmark positions in Romania, Georgia and Kazakhstan owing to strongopportunistic bottom-up ideas.



44


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

Since Inception^

(%) HSBC Insurance Emerging Europe Equity Fund 0.43 4.89 (2.04) (14.16) (21.20) N.A. 40.79

Benchmark* (3.81) 4.32 (11.68) (24.73) (37.79) N.A. 31.70


3-Year(%)

5-Year(%)

10-Year(%)

Since Inception^

(%) HSBC Insurance Emerging Europe Equity Fund (4.96) (4.65) N.A. 4.81 Benchmark* (9.04) (9.06) N.A. 3.85

*MSCI EM Europe 10/40 Net (TR) ^Inception Date: 20 Mar 2009


Schroder International Selection Fund - Emerging Europe 100.31 9.85Other liabilities (0.31) (0.03)

Total 100.00 9.82



C) Underlying Sub-Fund Disclosure (Schroder International Selection Fund – Emerging Europe) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

Russian Federation 51.11 284.93Turkey 16.16 90.09Poland 8.78 48.95Greece 4.82 26.87Hungary 3.92 21.85Georgia 3.15 17.56Czech Republic 3.03 16.89United States 2.72 15.16Others* 5.06 28.22Liquid Assets 1.25 6.97

Total 100.00 557.49*Includes other countries


Financials 38.87 216.71Energy 24.46 136.36Consumer Staples 8.32 46.38Consumer Discretionary 7.44 41.48Materials 5.64 31.44Information Technology 4.70 26.20Telecommunication services 3.29 18.34Industrials 3.18 17.73Health Care 1.59 8.86Utilities 1.26 7.02Liquid Assets 1.25 6.97

Total 100.00 557.49


45



Sberbank of Russia 10.19 56.82Lukoil 8.95 49.90Akbank 4.53 25.25Rosneft 4.53 25.25Gazprom 4.31 24.03NovaTek 3.80 21.18MMC Norilsk Nickel 3.45 19.23X5 Retail Group 3.11 17.34OTP Bank 2.87 16.00Luxoft Holding 2.72 15.16


Lukoil PJSC 9.43 48.47Sberbank of Russia 6.62 34.02MMC Norilsk Nickel PJSC 6.39 32.84Magnit PJSC 6.26 32.17Akbank TAS 4.65 23.90NovaTek OAO 4.23 21.74Gazprom PJSC 3.39 17.42OTP Bank PLC 3.17 16.29Tupras - Turkiye Petrol Rafinerileri AS 3.07 15.78Turkiye Garanti Bankasi AS 2.95 15.16

V Exposure to Derivatives As at 30 Jun 2016N.A.


D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Emerging Europe


As at 30-Jun-16 As at 30-Jun-15 As at 31-Mar-16* As at 30-Jun-15 Expense Ratio 2.00% 2.05% 1.96% 1.96% As at 30-Jun-16 Turnover Ratio 11.00% 11.39% 98.49% 90.49%

*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Schroder International Selection Fund - Emerging Europe for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions

N.A



46





HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Emerging Markets Equity Fund

47

HSBC Insurance Emerging Markets Equity Fund

Fund Objective

HSBC Insurance Emerging Markets Equity Fundseeks to achieve capital growth primarily throughinvestment in equity securities of emerging marketscompanies. Fund investments are made by way of afeeder fund, which invests substantially all, or all itsassets in the Schroder Emerging Markets Fund.


Global equities fell over the 12-month period. The2H15 was beset by high volatility, with concerns overglobal growth and weakness in China. In thisenvironment energy and commodity prices fellheavily. After much anticipation the FED hiked ratesby 25BPS in December. However, expectations forfurther increases have been deferred due torenewed uncertainty over the outlook for global

FUND FACTS Underlying Sub-Fund Schroder International Choice

Portfolio - Schroder Emerging Markets Fund


Launch Date 06 Nov 2006 CPFIS/SRS* SRS CPFIS Risk Classification

N.A


*Note: With effect from 1 Oct 2008, the Fund has ceased to accept new monies under CPFIS.

growth, in particular following the Brexit referendum result. Persistently below target inflation in the eurozoneled the ECB to launch further stimulus in March. Global equities have recovered somewhat in 2016, but havenot quite recouped last year’s losses. In emerging markets, USD strength and several country specific issueswere a headwind to returns, despite improvement in these factors more recently. The MSCI Emerging Markets index declined in value and underperformed the MSCI World.

Latin American markets held up comparatively better than wider emerging markets. This was largely due topolitical developments and easing currency pressure in 2016.

In emerging Asia, Indonesia was the strongest market. Improvement in the country’s current account deficit,combined with expectations for a delay to global USD liquidity tightening, was supportive to local equities andthe rupiah.

Emerging Europe, the Middle East and Africa markets were mixed. Hungary delivered a strong gain and wasthe best performing index market, supported by close trade ties with the eurozone, where economic growthhas been improving and monetary policy was loosened. Russia was slightly down in absolute terms butoutperformed. This was attributable to rouble weakness triggered by the energy price declines in late 2015.


The outlook for global markets continues to be dominated by the timing of policy normalisation in the US, andramifications on the USD, together with the sustainability of the growth recovery in Europe. The economicrepercussions of Brexit outside the UK are expected to be limited but the referendum result has unsettled market sentiment, which was already somewhat nervous given the subpar global growth recovery. After thesharp falls following the referendum result markets have since recovered, led by emerging markets. YTD the MSCI EM index has outperformed the MSCI World by a wide margin.

To our mind, the outlook for emerging markets had been showing tentative signs of improvement givenreceding headwinds; global economic growth appeared to be picking up at the margin, the USD looked to have peaked after a prolonged period of appreciation and Chinese growth was stabilising, at least in the short-term. The overall global GDP effect of Brexit is small but emerging markets are a key beneficiary of a global activity and the chances of a meaningful recovery from an extended period of lacklustre global growthnow look to be reduced. Tail risks have also clearly increased and the threat of nationalistic politicalcontagion, should it materialise, would likely increase investor risk aversion and serve to support the USD as a safe haven, both of which are negative for emerging markets. We believe that emerging markets can continue to outperform developed markets, not least given attractive relative valuations, but recent eventsonly serve to underline our view that it is difficult to get excited in absolute terms.



48


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Emerging Markets Equity Fund 0.74 (1.88) (11.78) (1.30) (10.84) N.A. (2.44)

Benchmark* 0.61 0.96 (12.09) 1.22 (9.59) N.A. 7.45


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Emerging Markets Equity Fund (0.43) (2.27) N.A. (0.26) Benchmark* 0.40 (2.00) N.A. 0.75

*MSCI Emerging Markets Index ^Inception Date: 21 Nov 2006


Schroder International Choice Portfolio - Schroder Emerging Markets Fund 100.03 30.79Other assets 0.13 0.04Other liabilities (0.16) (0.05)

Total 100.00 30.78



C) Underlying Sub-Fund Disclosure (Schroder International Choice Portfolio - Schroder Emerging Markets Fund)


Luxembourg 99.11 75.46Other net assets/(liabilities) 0.89 0.68

Total 100.00 76.14*HSBC Insurance Emerging Markets Equity Fund feeds wholly into Schroder Emerging Markets Fund (afeeder fund investing into a corresponding sub-fund in the Schroder International Selection Fund (ISF), anopen-ended investment company incorporated in Luxembourg).

II Allocation by Industry As at 30 Jun 2016N.A. (The fund invests wholly into an underlying collective investment scheme.)



Schroder International Selection Fund – Emerging Markets A Accumulation Share Class 99.11 75.46


Schroder International Selection Fund - Emerging Markets A Accumulation Share Class 99.12 90.95

*The rest of the holdings of the underlying fund are cash-in-transits and accruals.


49



D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Emerging

Markets Equity Fund Underlying Sub-Fund



*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Schroder International Choice Portfolio - Schroder Emerging Markets Fund for the financial year ended 30 Jun 2016 is not available.


N.A.


IV Soft Dollar Commission Arrangement The Fund invests substantially into the Schroder International Selection Fund Emerging Markets. In the management of the underlying fund, the manager may accept soft dollar commissions from, or enter into soft dollar arrangements with, stockbrokers who execute trades on behalf of the underlying fund and the soft dollars received are restricted to the following kinds of services:






HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Ethical Global Equity Fund

50

HSBC Insurance Ethical Global Equity Fund

Fund Objective

HSBC Insurance Ethical Global Equity Fund seeks to generate capital appreciation by way of a feederfund, which invests substantially all or all its assets into the Franklin Templeton Shariah Funds – Templeton Shariah Global Equity Fund. The Underlying Sub-Fund invests principally in Shariah-compliant equity and equity-related securities including common stocks of companies located anywhere in the world, including emerging markets.


Global Equities decline with a notable drop as ongoing global growth concerns, falling commodity prices and worries about the health of banks, particularly in Europe weighed on investor sentiment at the start of 2016. Markets subsequently rallied after key central banks announced additional easing measures and amid a rally in crude oil prices and easing concerns about China's economy.

FUND FACTS Underlying Sub-Fund Franklin Templeton Shariah

Funds - Templeton Shariah Global Equity Fund

Fund Manager Templeton Asset Management Ltd.

Launch Date 29 Sep 1995 CPFIS/SRS OA/SRS CPFIS Risk Classification

Higher Risk – Broadly Diversified


Note: With effect from 18 Nov 2013, the underlying sub-fund of HSBC Insurance Ethical Global Equity Fund, HSBC Amanah Funds - HSBC Amanah Global Equity - Z Class was replaced with Franklin Templeton Shariah Funds – Templeton Shariah Global Equity Fund.

However, a UK referendum vote near the end of the Q2 left the EU-Brexit-rattled financial markets across the world. Stock specific weakness within the industrials sector, overexposure to the IT sector and underweight exposure to the consumer stables sector dragged on relative performance. From a positive perspective, thePortfolio's overweight exposure combined with stock selection in the recovering energy sector contributed most; helping to offset some of the negative impacts. From a geographical perspective, selection combinedwith an underweight exposure to the strong-performing US dragged on performance the most. Superior stockselection among European names also helped to boost relative performance during the period. Whileuncertainty persists, our new “base case” following the Brexit referendum assumes that the UK will eventuallyleave the EU though Europe will hang together as a single market and currency union. We assume the domestic UK economy will suffer from Brexit with lower economic growth now expected, though the directeconomic impact elsewhere will likely be contained. Europe and the UK are both home to many multinational corporations with global operations in sectors like health care and energy whose sales and profits will not bematerially impacted by Brexit events.


While Brexit likely represents a near-term setback for the fund, we view the opportunities for long-term investors in global equity markets are currently both highly compelling and largely specific to valueinvestments. As anxiety and fear pervade the investor psyche, the valuation extremes long evident in deepcyclical sectors seem to be spreading more widely. The spread of value to many different sectors andregions may enhance the style’s appeal in the eyes of the generalist investor, helping strengthen thepotential for a sustainable value recovery. Yet, for now, value has remained unpopular against a backdrop oflow global growth, paltry yields, generally excessive debt and heightened uncertainty. We would expect valueinvestments to trade at a discount in this type of environment, but the gap as of quarter-end, exceeding even the discount that emerged during the TMT (Technology, Media and Telecom) Bubble, appeared excessive tous. While the global financial system today seems to be far better equipped to deal with systemic crisis than itwas during 2008, we nevertheless expect periods of instability and volatility as China’s economy continues totransition, US political risks rise and the forces that drove the Brexit vote struggle for ascendancy in variousparts of the world. We are confident that near-term pain could once again pave the way for long-term opportunity and believe we are positioning the portfolio optimally to maximize performance potential over along-term horizon.

^ Source: Templeton Asset Management Ltd.


51


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Ethical Global Equity Fund 0.57 (5.16) (8.12) 2.95 7.96 (0.91) 15.99 Benchmark* 3.59 (0.22) (1.00) 25.39 34.43 44.57 N.A.**


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Ethical Global Equity Fund 0.98 1.54 (0.09) 0.72 Benchmark* 7.83 6.10 3.75 N.A.**

*MSCI AC World Islamic Index. The performance figures are based on the new benchmark MSCI AC World Islamic Index, due to change in the underlying sub-fund. **The new benchmark MSCI AC World Islamic Index is not available when HSBC Insurance Ethical Global Equity Fund was incepted ^Inception Date: 04 Oct 1995


Franklin Templeton Shariah Funds - Templeton Shariah Global Equity Fund 99.95 55.28Other assets 0.41 0.23Other liabilities (0.36) (0.20)

Total 100.00 55.31



C) Underlying Sub-Fund Disclosure’(Franklin Templeton Shariah Funds - Templeton Shariah Global Equity Fund)


United States 28.37 39.85Japan 14.19 19.94United Kingdom 12.82 18.01France 6.24 8.77Germany 6.14 8.63China 5.72 8.04South Korea 4.62 6.49Switzerland 3.19 4.48Italy 2.55 3.58Others* 16.16 22.70



52


Energy 24.64 34.62Health Care 24.17 33.95Information Technology 12.67 17.80Consumer Discretionary 10.33 14.51Consumer Staples 8.79 12.35Industrials 7.59 10.67Materials 7.20 10.12Telecommunication Services 3.51 4.93Financials 1.10 1.54

Total 100.00 140.49



Royal Dutch Shell 3.79 5.33 Pfizer Inc 2.70 3.79 Samsung Electronics Co Ltd 2.56 3.60 Chevron Corporation 2.48 3.48 BP Plc 2.33 3.28 Eli Lilly & Co 2.15 3.02 Novartis AG 2.02 2.84 Sanofi 1.94 2.73 Walgreens Boots Alliance Inc 1.90 2.67 Total SA 1.83 2.57


Cvs Health Corp 2.95 2.60Pfizer Inc 2.78 2.45Novartos AG 2.41 2.12Walgreens Boots Alliance Inc. 2.12 1.87Bayer AG 2.07 1.82Samsung Electronic Co Ltd 2.05 1.81Sanofi 1.91 1.68Foot Locker Inc 1.73 1.52Chevron Corporation 1.61 1.42BP Plc 1.53 1.35




53

D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Ethical Global


As at 30-Jun-16 As at 30-Jun-15 As at 31-Mar-16* As at 30-Apr15** Expense Ratio 1.72% 1.90% 1.81% 1.90%

As at 30-Apr-16*** Turnover Ratio 2.16% 2.27% (109.96%)† 34.57%

*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Franklin Templeton Shariah Global Equity Fund for the financial year ended 30 Jun 2016 is not available. **Based on unaudited figures as at 30 Apr 2015 as the turnover and expense ratios of Franklin Templeton Shariah Global Equity Fund for the financial year ended 30 Jun 2015 is not available. ***Based on unaudited figures as at 30 Apr 2016 as the turnover and expense ratios of FranklinTempleton Shariah Global Equity Fund for the financial year ended 30 June 2016 is not available. †Turnover ratio calculation is based on Luxembourg GAAP.



IV Soft Dollar Commission Arrangement Consistent with obtaining best execution, brokerage commissions on portfolio transactions for theCompany may be directed by the Investment Managers to broker-dealers in recognition of research services furnished by them as well as for services rendered in the execution of orders by such broker-dealers. The receipt of investment research and information and related services permits the InvestmentManagers to supplement their own research and analysis and makes available to them the views andinformation of individuals and research staffs of other firms. Such services do not include travel, accommodation, entertainment, general administrative goods or services, general office equipment orpremises, membership fees, employee salaries or direct money payment, which are paid for directly bythe Investment Managers.

The Franklin Templeton Shariah Fund - Templeton Shariah Global Equity Fund paid US$12,518 incommission dollars generated from portfolio transactions to pay for goods or services provided by thirdparties under a soft dollar arrangement. All goods and services acquired with the soft dollar commissionwere for the benefit of the unit trust. The broker(s), who has executed trades for other funds managed bythe Investment Manager, had executed the trades on best available terms and there was no churning oftrades.



HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Ethical Global Sukuk Fund

54

HSBC Insurance Ethical Global Sukuk Fund

Fund Objective

HSBC Insurance Ethical Global Sukuk Fund seeks to maximise, consistent with prudent investment management, total investment return, consisting of a combination of profit income and capital appreciation through the Franklin Templeton Shariah Funds – Franklin Global Sukuk Fund.


The year to June 2016 was marked by increasing divergence between the improving fortunes of the developed world and signs of a slowdown in emerging markets. Despite the long awaited interest rate hike by the FED in December, the yeargenerally saw a continuation of the extraordinary central bank policies experienced since the Global Financial Crisis. Global yields continued to fall to levels not previously thought possible as central banks began to experiment with negative interest rates. Volatile commodity prices, signs of an economic slowdown in select emerging markets, the continued uncertainty over the future path of global

FUND FACTS Underlying Sub-Fund Franklin Templeton Shariah

Funds – Franklin Global Sukuk Fund

Fund Manager Templeton Asset Management Ltd.

Launch Date 02 May 2002 CPFIS/SRS* SRS CPFIS Risk Classification

N.A.


Note: With effect from 18 Nov 2013, the underlying sub-fund of HSBC Insurance Ethical Global Sukuk Fund, HSBC Amanah Global Equity Index Fund was replaced with Franklin Templeton Shariah Funds – Franklin Global Sukuk Fund

*Note: With effect from 18 Nov 2013, the Fund has been delisted from CPFIS.

monetary policy, and UK surprise decision to leave the EU all contributed to market volatility during theperiod.

For the year ending June 30 2016, currency and defensive duration positioning were the primary driver ofunderperformance, while security selection also had a negative effect. Conversely, the Fund benefited fromits sector allocations. Much of the negative currency effect was due to Malaysian ringgit holdings, although asmall amount of exposure to the British Pound also weighed on relative performance. The overall decline inUS Treasury yields during the period provided another source of relative underperformance as the portfolio generally had a shorter duration than its benchmark during the period.


The surprise decision of voters in the UK in favour of the Brexit has left several outstanding questions to be debated in the weeks and months ahead, and for Sukuk investors, this major market event helps highlight thebenefits of the low-beta characteristics of these fixed income markets, and the effective benefits they canbring to diversification or enhancing risk-return profiles of investment portfolios. Looking ahead to theremainder of 2016, we believe the potential for looser monetary policy in the US and a concurrent rise in theyen as well could suggest a positive outlook for emerging markets in the future. Such a scenario would be beneficial for currencies such as the ringgit and rupiah, both already trading at low trade-weighted historical valuations at quarter-end. We believe Sukuk markets are fairly well positioned: most debt is still investment grade and is largelydenominated in USD, and the region is in the midst of a significant capital market development phase. We think Sukuk will continue to exhibit low correlation to oil and financial risk assets, low volatility andcompetitive risk-adjusted returns, which will serve investors well against a backdrop of global economicuncertainty.



55


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Ethical Global Sukuk Fund 1.12 (1.64) 1.59 24.95 31.85 22.76 14.88

Benchmark* 2.05 (0.81) 4.32 22.15 36.12 32.59 N.A.**


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Ethical Global Sukuk Fund 7.71 5.69 2.07 1.00 Benchmark* 6.90 6.36 2.86 N.A.**

*Dow Jones Sukuk Index. The performance figures are based on the new benchmark Dow Jones SukukIndex, due to change in the underlying sub-fund. **The new benchmark Dow Jones Sukuk Index is not available when HSBC Insurance Ethical GlobalSukuk Fund was incepted. ^Inception Date: 01 Jul 2002


Franklin Templeton Shariah Funds - Franklin Global Sukuk Fund 99.84 18.45Other assets 0.21 0.04Other liabilities (0.05) (0.01)

Total 100.00 18.48


Subscription 198,557 Redemption 1,675,290

C) Underlying Sub-Fund Disclosure (Franklin Templeton Shariah Funds - Franklin Global Sukuk Fund)


United Arab Emirates 37.59 52.80Malaysia 13.04 18.32Saudi Arabia 9.90 13.91Indonesia 8.71 12.24Turkey 7.93 11.14Qatar 7.40 10.40United States 2.56 3.60United Kingdom 1.57 2.20Kuwait 1.20 1.69ST Cash & Cash Equivalents 10.10 14.19

Total 100.00 140.49


Corporate Financial Institutions 22.50 31.62Government-Related Agencies 20.07 28.20Government-Related Sovereign 17.48 24.56Corporate High Yield 16.58 23.29Treasury 6.33 8.89Corporate Industrials 4.68 6.57Government-Related Local Authority 2.26 3.17Cash & Cash Equivalents 10.10 14.19

Total 100.00 140.49


56


(For Debt securities portfolio only) AA 4.60 6.45A+ 6.27 8.81A 22.88 32.15A- 7.44 10.45BBB+ 13.68 19.22BBB 8.99 12.63BBB- 15.19 21.34BB 2.39 3.36C 4.73 6.65Unrated 13.83 19.43

Total 100.00 140.49


Asya Sukuk Co. Ltd., 3/20/23 4.23 5.98Government of Malaysia, senior bond, 4.444%, 5/22/24 3.87 5.43MAF Sukuk Ltd., 4.50%, Reg S, 11/03/25 3.67 5.15GEMS MEA Sukuk Ltd., junior sub. note, Reg S, 12.00% to 11/21/18, FRN thereafter, Perpetual 3.65 5.13Dana Gas Sukuk Ltd., cvt., senior note, Reg S, 7.00%, 10/31/17 3.59 5.04Perusahaan Penerbit SBSN Indonesia III, senior note, Reg S, 4.325%, 5/28/25 3.40 4.77Saudi Electricity Global Sukuk Co. 3, senior note, Reg S, 5.50%, 4/08/44 3.15 4.42Perusahaan Penerbit SBSN Indonesia III, Reg S, 4.55%, 3/29/26 2.83 3.97Sime Darby Global Bhd., senior note, Reg S, 3.29%, 1/29/23 2.69 3.78SoQ Sukuk A Q.S.C, Reg S, 3.241%, 1/18/23 2.56 3.60


Malaysia Government Investment Issue, senior bond, 0813, 4.444%, 5/22/24 4.50 5.73GEMS MEA Sukuk Ltd., junior sub. note, Reg S, 12.00% to 11/21/18, FRN thereafter, Perpetual

3.96 5.04

Asya Sukuk Co. Ltd., 3/20/23 3.76 4.78Saudi Electricity Global Sukuk Co. 3, senior note, Reg S, 5.50%, 4/08/44 3.58 4.56Anka a Sukuk Ltd., Reg S, 10.00%, 8/25/16 3.56 4.53TF Varlik Kiralama AS, senior note, Reg S, 5.375%, 4/24/19 3.54 4.51Perusahaan Penerbit SBSN Indonesia III, senior note, Reg S, 4.325%, 5/28/25 3.53 4.49DP World Sukuk Ltd., Reg S, 6.25%, 7/02/17 3.40 4.33Albaraka Turk Katilim Bankasi AS, senior note, Reg S, 6.25%, 6/30/19 3.13 3.98Sime Darby Global Bhd., senior note, Reg S, 3.29%, 1/29/23 2.88 3.67



D) Other Disclosure ItemsI Expense/Turnover Ratios HSBC Insurance Ethical Global

Sukuk Fund Underlying Sub-Fund


As at 30-Apr-16** Turnover Ratio 4.67% 3.73% 16.20%*** 47.69%

*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Franklin Global Sukuk Fund for the financial year ended 30 Jun 2016 is not available. **Based on unaudited figures as at 30 April 2016 as the turnover ratio of Franklin Global Sukuk Fund forthe financial year ended 30 June 2016 is not available. ***Calculation is based on Luxembourg GAAP.


57

II Related-Party Transactions Cash balances maintained with HSBC Bank as at 30 Jun 2016 amounts to S$32,414.





HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Europe Dynamic Equity Fund

58

HSBC Insurance Europe Dynamic Equity Fund

Fund Objective

HSBC Insurance Europe Dynamic Equity seeks to maximise long-term capital growth by investing primarily in an aggressively managed portfolio of European companies. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the JPMorgan Funds – Europe Dynamic Fund.


Over the past twelve month period our behavioural Finance process has outperformed with all three of

FUND FACTS Underlying Sub-Fund JPMorgan Funds – Europe

Dynamic Fund Fund Manager J.P. Morgan Asset

Management.Launch Date 18 Jan 2016 CPFIS/SRS* SRS CPFIS Risk Classification

N.A.


the styles that we target; value, quality and momentum performing positively with momentum contributing the most.

The fund, which has an unconstrained, conviction-based approach to investing in attractively valued, high quality stocks with positive momentum, underperformed its benchmark over this 12 month period by 2.27% (gross of fees). This is mostly attributable to the YTD period where we have seen challenging June due to Brexit and a difficult first few months of the year when company fundamentals and share prices diverged as global growth concerns materialized in the US and Asia and, to some extent, in Europe.

At the sector level, the biggest contributors to relative returns included and overweight and stock selection in capital goods through stocks such as the wind turbine producers Vestas Wind Systems and Gamesa. Our underweight position in banks was also positive as the sector continues to struggle. Detractors included our underweight position in food beverage & tobacco and our overweight position in automobiles and components.

During the year the European domestic economy continued its recovery. The main problem during the year turned out to be growth overseas outside Europe, and especially in emerging markets. The oil price continued to fall, the price of other industrial commodities also fell, and these two factors affected confidence about global growth.


Conditions for the Eurozone recovery remain conducive. The ECB’s QE programme means the cost of borrowing for governments and also for high-grade corporates should be contained. This will assist government finances on one hand, and should also boost corporate confidence. The drab general picture for earnings has masked good performances in certain sectors, such as car manufacturers and parts suppliers, or insurers. It has also masked significant divergences within sectors. We believe that this divergence will continue. Earnings for energy and commodities companies are forecast to recover as commodities prices stabilise. Earnings from the domestic economy can continue to improve, and valuation is undemanding, especially relative to bonds and cash.

The outlook for the UK is politically uncertain. We expect a sharp slowdown in the UK economy as a result of uncertainty and the deferral of investment decisions, which may even tip over into a recession, and this would have a very negative effect on government finances and the budget deficit. We know that the Bank of England (BoE) stands ready to increase the provision of liquidity and possibly to cut rates, and this is likely to lead to further Sterling weakness given the size of the UK’s current account deficit. More broadly in the rest of Europe we think that growth will hold up, with the emphasis more on domestic recovery than on exports.

^ Source: JPMorgan Asset Management (Singapore) Limited


59


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Europe Dynamic Equity Fund (1.23) N.A. N.A. N.A. N.A. N.A. 1.04

Benchmark* 1.61 N.A. N.A. N.A. N.A. N.A. 4.06

*MSCI Europe Index (Total Return Net) Hedged to SGD ^Inception Date: 25 Jan 2016


Asset Class % of NAV MV S$ mil JPMorgan Funds – Europe Dynamic Fund 93.75 0.15 Other assets 6.25 0.01

Total 100.00 0.16


Subscription 156,733 Redemption -

C) Underlying Sub-Fund Disclosure (JPMorgan Funds – Europe Dynamic Fund) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil United Kingdom 28.30 564.09 France 16.20 322.90 Germany 14.10 281.05 Switzerland 12.50 249.15 Denmark 5.90 117.60 Netherlands 5.10 101.66 Italy 3.40 67.77 Others* 8.90 177.40 Net Liquidity 5.60 111.62


II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil Consumer Staples 18.20 362.77 Financials 14.50 289.02 Health Care 11.60 231.22 Industrials 11.40 227.23 Consumer Discretionary 10.50 209.29 Energy 8.70 173.41 Materials 8.40 167.43 Others* 11.10 221.25 Net Liquidity 5.60 111.62




60


Nestle 3.08 61.39 Roche 3.04 60.66 Royal Dutch Shell 2.68 53.32 Reckitt Benckiser 2.65 52.92 Siemens 2.55 50.89 Novo Nordisk 2.40 47.80 British American Tobacco 2.19 43.66 Unilever 2.07 41.25 Orange 2.00 39.77 BNP Paribas 1.97 39.35



D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Europe Dynamic


As at 30-Jun-16 As at 31-Dec-15*

Expense Ratio 1.79% 1.80% Turnover Ratio 206.91% 192.39%** *Based on the unaudited figures as at 31 Dec 2015 as the expense and turnover ratio of JPMorgan Funds – Europe Dynamic Fund for the financial year ended 30 Jun 2016 is not available. **Turnover Ratio calculation is based on Swiss Funds and Asset Management Association






HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Europe Equity Fund

61

HSBC Insurance Europe Equity Fund

Fund Objective

HSBC Insurance Europe Equity Fund seeks toachieve capital growth primarily through investmentin equity securities of European companies. Fundinvestments are made by way of a feeder fund, whichinvests substantially all, or all its assets in theSchroder European Equity Alpha Fund.


European equities registered negative absolutereturns for the period under review. The portfolio alsosaw a negative absolute return, narrowlyunderperforming the benchmark.

Merger & acquisition (M&A) activity was a feature ofthe period for our portfolio. Travel services firm Kuoniwas the top individual contributor to fund

FUND FACTS Underlying Sub-Fund Schroder International Choice

Portfolio - Schroder European Equity Alpha Fund


Launch Date 14 Oct 2005 CPFIS/SRS* SRS CPFIS Risk Classification

N.A.


*Note: With effect from 1 Oct 2008, the Fund has ceased to accept new monies under CPFIS.

performance over the period after several parties expressed interest. Private equity firm EQT emerged as thepreferred bidder and paid Swiss Franc (CHF) 370 per share for the Swiss group. Saft Groupe, a maker ofbatteries used in transport and industry, received a takeover bid from Total at €36.50 per share. Catering firm Gategroup was another contributor after accepting a CHF53 per share takeover offer from Chinese aviation and tourism group HNA.

On the negative side, Royal Bank of Scotland (RBS) was the main individual detractor after warning that its 4Q15 results would be impacted by £3.6 billion of extraordinary charges relating to the pension scheme andpossible litigation charges. The banking sector came under further pressure in the wake of the UK’s vote to leave the EU. In the short-term RBS faces multiple headwinds from litigation to regulatory uncertainty, whilelow interest rates continue to hamper profitability. But the potential for long-term capital and dividend growth is significant. It is one of the best capitalised banks in Europe, yet currently trades at just 0.6x its tangiblebook value. Regulatory & litigation headwinds did not stop utilities or tobaccos being the best investments ofthe noughties, and we believe UK banks offer the best opportunity for attractive returns to value investorswithin the UK for the coming decade.


The advantage of creating the Global Value team in 2013 was that the structure allowed the coming togetherof a group of like-minded investors managing portfolios across UK, European and Global equities. Thephilosophy and investment approach of all of the members of the team is a common one and therefore thestructure has ensured that in these circumstances we can ensure a very high level of continuity in the waythat the portfolios are run.

The UK’s recent referendum on EU membership has dominated investors’ thoughts lately. The next sixmonths, or even the next couple of years, are likely to be characterised by the media as ones of 'great uncertainty'. There is sure to be uncertainty over UK-domiciled exporters to the EU - they will have to thinkabout duties which may be levied, or product certification to which they will have to adhere etc. Similarly,there may be problems for EU-domiciled exporters to the UK. The only certainty is that tax law just becamean even more lucrative profession.

These uncertainties will impact businesses planning long-term agreements across the new UK/EU borderboth for trade and investment. The UK has had a freely floating currency since the demise of the exchange rate mechanism, and so while hedging may be more expensive, for a while, the imposition of a trade borderis not the same as the demise of a currency union. However, as managers of a well-diversified portfolio, we should not mistake this perceived 'great uncertainty' for reality.



62


3-Mth (%)

6-Mth (%)

1-Year (%)

3-Year (%)

5-Year (%)

10-Year (%)

SinceInception^

(%)HSBC Insurance Europe Equity Fund (5.14) (12.57) (11.75) 12.19 14.01 (7.98) 4.13

Benchmark* (2.74) (9.99) (11.26) 12.48 15.36 (1.03) 12.06 II Average Annual Compounded Returns

3-Year (%)

5-Year (%)

10-Year (%)

SinceInception^

(%) HSBC Insurance Europe Equity Fund 3.91 2.66 (0.83) 0.38 Benchmark* 4.00 2.90 (0.10) 1.07

*MSCI Europe Net (TR) Index ^Inception Date: 28 Oct 2005


Schroder International Choice Portfolio - Schroder European Equity Alpha Fund 100.00 16.48 Total 100.00 16.48



C) Underlying Sub-Fund Disclosure (Schroder International Choice Portfolio - Schroder European Equity Alpha Fund)


Luxembourg* 99.24 66.16Other net assets/(liabilities) 0.76 0.51

Total 100.00 66.67* HSBC Insurance Europe Equity Fund feeds wholly into Schroder European Equity Alpha Fund (a feederfund investing into a corresponding sub-fund in the Schroder International Selection Fund (ISF), an open-ended investment company incorporated in Luxembourg).

II Allocation by Industry As at 30 Jun 2016N.A. (The fund invests wholly into an underlying collective investment scheme).



Schroder International Selection Fund - European Equity Alpha A Accumulation Share Class 99.24 66.16


Schroder International Selection Fund - European Equity Alpha A Accumulation Share Class 98.97 83.58

*The rest of the holdings of the underlying sub-fund are cash-in-transits and accruals.


63



D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Europe Equity




*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Schroder International Choice Portfolio - Schroder European Equity Alpha Fund for the financial year ended 30 Jun 2016 is not available.


N.A.


IV Soft Dollar Commission Arrangement The Fund invests substantially into the Schroder International Selection Fund European Equity Alpha. Inthe management of the underlying fund, the manager may accept soft dollar commissions from, or enterinto soft dollar arrangements with, stockbrokers who execute trades on behalf of the underlying fund andthe soft dollars received are restricted to the following kinds of services:






HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Global Bond Fund

64

HSBC Insurance Global Bond Fund

Fund Objective

HSBC Insurance Global Bond Fund seeks to maximize total returns in Singapore Dollar terms over the longer term by investing in a portfolio of high quality debt securities of Singapore and major global bond markets such as the G10 countries and Australia and New Zealand. Fund investments are by way of a feeder fund, which invests substantially all or all its assets in the Legg Mason Western Asset Global Bond Trust.


FUND FACTS Underlying Fund Legg Mason Western Asset

Global Bond Trust Fund Manager Western Asset Management

Company Pte. Ltd. Launch Date 06 Oct 2008 CPFIS/SRS OA/SA/SRS CPFIS Risk Classification

Low to Medium Risk – Broadly Diversified


In stark contrast to financial market expectations, the UK voted to leave the EU after 43 years ofmembership. The response of the global fixed-income and currency markets, while significant, was moremuted and orderly than expected given the additional economic and political uncertainty that resulted from the outcome. Sterling weakened sharply, spread sectors underperformed, the yen appreciated andgovernment yields declined. 10-year US Treasury yields ended the month around 1.5%, close to their 2012lows. The UK Prime Minister David Cameron announced his resignation and Standard and Poor (S&P) downgraded the UK’s sovereign credit rating from AAA to AA. UK financial issuers underperformed due toconcerns over UK growth, weaker earnings growth and more volatile funding conditions moving forward. Spread sectors recovered towards the end of the month as FED rate hike expectations diminished and BoEGovernor Mark Carney gave a clear indication policy would likely be eased over the summer. In Mexico, theCentral Bank raised rates by 0.5% aimed at preventing further currency depreciation and anchoring inflationexpectations.

The UK’s decision to leave the EU raises significant political and economic uncertainty, which is likely to havea negative impact on investment and consumer confidence in both the UK and Europe. However, with globalgrowth and inflation risks skewed to the downside, we expect the BoE, ECB and Bank of Japan (BoJ) to provide further policy accommodation over the coming months, and for the FED to retain its “data dependent” bias.


While recognizing that downside risks persist, Western Asset’s view remains that the global recovery, thoughfragile, will be positive and sustainable as policy accommodation from central banks around the worldultimately succeeds in underpinning growth.

In our opinion, the FED is now unlikely to raise rates this year. The FED will be concerned about the potential negative impact on global growth from Brexit and any tightening of financials conditions from a stronger USDor weaker equity markets. We therefore expect the FED to maintain a cautious, risk-management-focused approach, absent a much stronger signal from the economic data or from markets. Overall, we expect globalbond yields to remain in relatively narrow ranges over the next few months, so tactical duration and yieldcurve management remain key macro strategies.

In the UK, investment is likely to be considerably weaker as companies defer spending plans until there ismore clarity over the UK’s future relationship with the EU. Consumer confidence is also likely to be hit, furtherimpacting the growth outlook. However, against this, the 15% depreciation in sterling on a trade-weighted basis over the last 12 months should help the export sector while a further easing of monetary policy by theBoE, which we anticipate over the next few months, will help to cushion the downturn.

With volatility likely to remain elevated, we will look for opportunities to take advantage of market anomalies.Our focus remains on longer-term fundamentals with diversified strategies to manage risk.



65


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Global Bond Fund 2.01 5.24 7.92 16.65 28.15 N.A. 25.71 Benchmark* 2.67 6.43 9.12 19.92 32.64 N.A. 30.27


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Global Bond Fund 5.27 5.09 N.A. 3.00 Benchmark* 6.24 5.81 N.A. 3.48

*Citigroup World Government Bond Index ex-Japan (hedged to S$) ^Inception Date: 09 Oct 2008


Legg Mason Western Asset Global Bond Trust 100.00 10.55 Total 100.00 10.55



C) Underlying Fund Disclosure (Legg Mason Western Asset Global Bond Trust) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

USA 36.79 139.27Italty 13.43 50.85Mexico 6.40 24.23France 6.29 23.80Poland 5.21 19.71Germany 5.12 19.37Japan 4.37 16.56Great Britain 3.92 14.84Others* 11.29 42.72Cash 7.18 27.19



Government 91.53 346.47Financials 1.33 5.03Miscellaneous (0.04) (0.15)Cash 7.18 27.19

Total 100.00 378.54


66


(For Debt securities portfolio only) Aaa 12.21 46.25AA+ 36.79 139.27AA 3.81 14.44Aa2 6.29 23.80AA- 0.37 1.39A 4.44 16.81A- 5.21 19.71A3 7.30 27.62Baa2 3.29 12.44BBB- 13.43 50.85Unrated (0.32) (1.23)Cash 7.18 27.19

Total 100.00 378.54


US Treasury Note 1.5% 31/12/2018 9.00 34.07US Treasury Note 1.00% 15/09/2017 7.36 27.85US Treasury Bond 4.5% 15/08/2039 5.58 21.11Buoni Poliennali Del Tes 1.45% 15/09/2022 5.44 20.61TSY INFL IX N/B 0.250% 15/01/2025 5.24 19.83 Poland Governement Bond Ser 726 2.5% 25/07/2026 5.21 19.71Mex Bonds Desarr Fix RT Ser M 7.75% 13/11/2042 4.72 17.85Japan (Govt of) CPI Linked Ser 16 1.4% 10/06/2018 4.44 16.81US Treasury Bond 2.875% 15/05/2043 3.93 14.89Bundesrepub Deutschland (Br) 2.5% 15/08/2046 3.85 14.59


US Treasury Note 0.625% 31/08/2017 8.32 29.38US Treasury Note 1.00% 15/09/2017 7.89 27.87Buoni Poliennali Del Tes 3.75% 01/09/2024 7.75 27.37US Treasury Note 1.5% 31/12/2018 5.98 21.14Buoni Poliennali Del Tes 3.75% 01/05/2021 5.50 19.44US Treasury Bond 4.5% 15/08/2039 5.15 18.20Bonos Y Oblig Del Estado 3.75% 31/10/2018 5.10 18.03Japan (Govt of) CPI Linked Ser 16 1.4% 10/06/2018 4.16 14.70UK Treasury 4.25% 07/12/2040 3.72 13.14US Treasury Bond 3.625% 15/02/2044 3.66 12.94

V Exposure to Derivatives As at 30 Jun 2016% of NAV 2.06%Market value (S$) 7,809,732Realised Gains / (Losses) (S$) -Unrealised Gains / (Losses) (S$) 7,809,732


D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Global Bond




*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Legg Mason Western Asset Global Bond Trust for the financial year ended 30 Jun 2016 is not available.


67







HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Global Emerging Markets Bond Fund

68

HSBC Insurance Global Emerging Markets Bond Fund

Fund Objective

HSBC Insurance Global Emerging Markets Bond Fund invests for total return primarily in a diversified portfolio of Investment Grade and Non-Investment Grade rated fixed income (e.g. bonds) and othersimilar securities either issued by companies which have their registered office in emerging markets around the world, primarily denominated in USD, orwhich are issued or guaranteed by governments, government agencies and supranational bodies ofemerging markets. Fund investments are made by way of a feeder fund, which invests substantially all, or all its assets in the HSBC Global Investment Funds – Global Emerging Markets Bond.


Funds – Global Emerging Markets Bond



N.A.



Volatility spiked over the period due to continuing concerns regarding China’s outlook, volatile commodity prices, declining global growth and the expected rise in US interest rates. Emerging market assets rallied in 1H16 based on the expectations of continued support from global monetary policymakers, rebound incommodity prices, and improved risk sentiment. Positive performance was supported by the sharpcompression of US Treasury yields in 1H16 declining from 2.27% to 1.47% at the end of June. The fundunderperformed the benchmark in the period with the largest detractor to relative performance derived from the fund's underweight position to hard currency duration as duration rallied in this environment.


After reducing the underweight to hard currency duration and spread duration in May, we maintained theunderweight to hard currency duration of -1 year versus the benchmark and an underweight to spreadduration of -1 year versus the benchmark. Over the period, the fund was invested in off-benchmark currency positions in emerging market currencies with improved valuations and high levels of carry. In terms ofoutlook, we believe emerging markets will continue to face periodic turbulence given the deceleration of theChinese economy, a revision in expectations of FED tightening and continued geopolitical events. However, recently we have become more constructive on emerging markets as we begun to observe stabilization in economic fundamentals in a number of countries, global monetary policy support has mitigated externalthreats, and finally, valuations are attractive in emerging markets versus the developed markets.



3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Global Emerging Markets Bond Fund 4.20 9.13 7.02 14.42 N.A. N.A. 5.92

Benchmark* 5.35 5.21 10.27 27.97 N.A. N.A. 22.32


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Global Emerging Markets Bond Fund 4.59 N.A. N.A. 1.71 Benchmark* 8.57 N.A. N.A. 6.11

*JP Morgan EMBI Global Index ^Inception Date: 06 Feb 2013


69


HSBC Global Investment Funds – Global Emerging Markets Bond 100.00 0.93 Total 100.00 0.93



C)Underlying Sub-Fund Disclosure (HSBC Global Investment Funds – Global Emerging Markets Bond)


Mexico 13.47 722.84Turkey 11.52 618.20Indonesia 10.22 548.44Brazil 9.76 523.75China 5.78 310.17S.Africa 4.51 242.02Colombia 4.43 237.73Others* 36.79 1,974.28Cash 3.52 188.89

Total 100.00 5,366.32*Includes other countries


Sovereign 78.11 4,192.40Oil&Gas 14.86 797.33Banks 1.47 78.68Electric 1.02 54.95Mining 0.59 31.62Investment Companies 0.32 16.91Iron/Steel 0.07 3.54Media 0.04 2.00Cash 3.52 188.89

Total 100.00 5,366.32

III Allocation of Debt Securities by Credit Ratings As at 30 Jun 2016 Ratings % of NAV MV S$ mil

(For Debt securities portfolio only) AAA 1.94 104.49A 7.78 417.34 BBB 63.16 3,389.46 BB 12.98 696.33 B 6.54 350.96 CCC 3.74 200.77 Unrated 0.34 18.08

Total 96.48 5,177.43


70


Turkey (Republic of)-Global 6.25% 26/09/22 3.79 203.63Republic of Indonesia 4.875% 05/05/21 2.48 133.30Turkey (Republic of)-Global 7% 11/03/19 2.17 116.40Kazakhstan (Republic of) 5.125% 21/07/25 2.04 109.31United Mex States-Global 6.05% 11/01/40 1.98 106.36Republic of Indonesia 3.75% 25/04/22 1.78 95.50Colombia (Rep of)-Global 6.125% 18/01/41 1.73 92.99Hungary Republic of - Global 6.375% 29/03/21 1.61 86.20South Africa Rep of - Global 5.5% 09/03/20 1.58 84.66United Mexican States 4.6% 23/01/46 1.54 82.87


Utd Mexican STS Medium Term NTS Book TBond 4 DU 4% 02/10/23 2.29 183.12Indonesia(REP OF) 4.875% MTN 05/21 USD'REGS' 5% 05/05/21 2.20 176.43United States Treas Bills Due 07-23-2015 0% 23/07/15 2.08 166.42United States Treas NTS Fixed 2.0% Due 02-15-202 2% 15/02/25 1.90 152.19Bank Tokyo Mitsubishi UFJ Ltd N Y BRH IADTD 06-10- 0% 05/08/15 1.72 137.90Bpce Disc Coml Paper 4/2 YRS 3&4 07-10-2015 0% 10/07/15 1.72 137.89Toronto Dominion HLDGS USA Inc Discount Commerical 0% 22/07/15 1.72 137.88Sumitomo Mitsui BKG Corp Disc Coml Paper4/2 YRS 3& 0% 15/07/15 1.72 137.88BNP Paribas New York BRH 3/A3 Disc Coml Paper YRS 0% 03/08/15 1.72 137.87Global BD 4.375% Due 07-12-2021 REG 4% 12/07/21 1.71 137.28

V Exposure to Derivatives As at 30 Jun 2016% of NAV 6.71%Market value (S$) 15,288,340 Realised Gains / (Losses) (S$) (1,604,372)Unrealised Gains / (Losses) (S$) 15,288,340


D) Other Disclosure Items

I) Expense/Turnover Ratios HSBC Insurance Global

Emerging Markets Bond Fund Underlying Sub-Fund



*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of HSBC Global Investment Funds – Global Emerging Markets Bond for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions HSBC Insurance Global Emerging Markets Bond Fund S$0.93 million, equivalent to 100% of its net asset value in HSBC Global Investment Funds – Global Emerging Markets Bond, which is managed by HSBC Global Asset Management (Singapore) Ltd.

The management fees earned by HSBC Global Asset Management (Singapore) Ltd from 01 July 2015 to 30 June 2016 amounts to S$5,107.




71




HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Global Emerging Markets Equity Fund

72

HSBC Insurance Global Emerging Markets Equity Fund

Fund Objective

HSBC Insurance Global Emerging Markets Equity seeks to provide long-term capital growth by investing primarily in emerging market companies. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the JPMorgan Funds – Emerging Markets Equity.

Investment and Market Review ^ Concerns over the global impact of China’s economic slowdown dominated financial markets in

FUND FACTS Underlying Sub-Fund JPMorgan Funds – Emerging

Markets Equity Fund Fund Manager J.P. Morgan Asset

Management.Launch Date 18 Jan 2016 CPFIS/SRS* SRS CPFIS Risk Classification

N.A.


the 2H15. The market turmoil was sparked by an intensification of worries about the Chinese economy and the possible spill-over into other emerging and developed markets, with the immediate triggers being weak manufacturing, purchasing manager’s index (PMI) data in China and an opaque Chinese policy response.

Emerging market equities suffered a double-digit decline during the first three weeks of 2016. China was the epicentre with the domestic markets correcting sharply as weak PMI data compounded existing concerns over the currency. However, from the market low on 21st January, emerging markets rebounded helped by an extended period of USD weakness, the FED perceived to be on hold, commodity price stability and low relative valuations.

The fund outperformed its benchmark significantly during the review period driven mainly by our stock selections as we intended to. Our investment decisions in Brazil, Russia, India and China (BRIC) countries were among the top contributors in particular in the financial sector. The performance benefited from our overweight in banks in Russia and India, and our underweight in Chinese banks. Our stock selections in IT also helped.The long-term investment case in IT is predicated on: (a) their economies of scale, which act as barriers to entry and deliver strong cash flows and economics; (b) the ongoing trend towards outsourcing, which supports long-term growth (duration); and (c) the requirement for strong governance in order to win global clients. Our stock selection and an overweight in South Africa however detracted from the performance


A volatile first half in markets became more volatile in June, with the surprising decision by UK voters to leave the European Union. However, very few investors would have predicted the sharp rally that followed only a few days later, taking global equities ex-Europe back to their starting point for the month. Even more encouraging for emerging market (EM) investors is that EM equities and currencies, on the whole, led the charge and outperformed.

EM currencies and equities reached compelling valuations on an absolute and relative basis multiple times over the past year, following five years of significant underperformance. However, attractive valuations have not been sufficient to shield these markets from previous risk-off sell-offs. What makes this time different is that investors were quick to anticipate the broader policy implications of the Brexit vote. Expectations of Federal Reserve rate hikes were pushed out indefinitely, giving at least a temporary "all clear" signal for the emerging markets’ underperforming equities and oversold currencies.

While we believe the relative case for emerging market equities has improved, we continue to recommend patience to our investors, advocating building exposure when valuations reach atypical lows. We will remain wary of the case for a new, secular bull market in emerging markets until we see clear evidence that the EM growth premium is expanding and earnings estimates are finally turning. The good news is, we believe much of de-rating and downgrading has already taken place, so the long-awaited positive turn may be getting closer.

^ Source: JPMorgan Asset Management (Singapore) Limited


73


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Global Emerging Markets Equity Fund 4.37 N.A. N.A. N.A. N.A. N.A. 13.73


*MSCI Emerging Markets Index (Total Return Net) ^Inception Date: 16 Feb 2016


Asset Class % of NAV MV S$ mil JPMorgan Funds – Emerging Markets Equity Fund 100.00 0.03

Total 100.00 0.03



C) Underlying Sub-Fund Disclosure (JPMorgan Funds – Emerging Markets Equity Fund) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil India 22.00 1,049.17 South Africa 17.30 825.03 China 17.30 825.03 Brazil 11.80 562.74 Taiwan 8.40 400.59 Russia 5.90 281.37 South Korea 3.10 147.84 Others* 13.60 648.58 Net Liquidity 0.60 28.61


II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil Financials 30.20 1,440.23 Information Technology 23.60 1,125.47 Consumer Discretionary 13.90 662.89 Consumer Staples 13.40 639.04 Industrials 6.40 305.21 Energy 5.00 238.45 Health Care 3.30 157.38 Others* 3.60 171.68 Net Liquidity 0.60 28.61




74


Tencent 13.58 217.67 Taiwan Semiconductor Manufacturing Company 13.56 217.39 Housing Development Finance 12.49 200.25 HDFC Bank 11.37 182.30

AIA 11.27 180.62 Tata Consultancy Services 10.41 166.89 Magnit 8.50 136.25 Sberbank of Russia 6.69 107.22 ITC 6.54 104.82 Samsung Electronics 5.59 89.53



D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Global Emerging

Markets Equity Fund Underlying Sub-Fund

As at 30-Jun-16 As at 31-Dec-15* Expense Ratio 1.80% 1.80% Turnover Ratio 211.08% 0.00%** *Based on the unaudited figures as at 31 Dec 2015 as the expense ratio of JPMorgan Funds – Emerging Markets Equity Fund for the financial year ended 30 Jun 2016 is not available.

**Turnover Ratio calculation is based on Swiss Funds and Asset Management Association






HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Global Equity Fund

75

HSBC Insurance Global Equity Fund

Fund Objective

HSBC Insurance Global Equity Fund seeks to achieve long-term growth of capital by investing in a portfolio of equity securities. Fund investments are made by way of a feeder fund, which invests substantially all, or all its assets in the AllianceBernstein - Global Equity Blend Portfolio.


Global equity markets got off to a rough start in the first six weeks of 2016 falling by over 10% as investors worried about global growth, Chinese polices, the stability of European banks and assorted geopolitical issues. However, as oil and commodity

FUND FACTS Underlying Fund AllianceBernstein- Global

Equity Blend Portfolio Fund Manager AllianceBernstein

(Luxembourg) S.à r.l. Launch Date 06 Oct 2008 CPFIS/SRS OA/SRS CPFIS Risk Classification

Higher Risk – Broadly Diversified


*Note: With effect from 31 Aug 2016, the Fund has been delisted from CPFIS

prices began to stabilize and solid economic data was released, equity markets rebounded into the secondquarter.

June brought another bout of volatility after Britain’s unexpected referendum vote to exit the EU. In the days following the June 23 vote, stocks fell sharply as investors sold risk assets, preferring safe havens such asgold and sovereign debt. Currency markets were turbulent. Markets began to rebound by the end of thesecond quarter as investors concluded that the timetable for Britain’s exit from the EU and the economicterms would remain unclear in the near-term. Despite the volatility during the 1H16, the MSCI World Indexrose 0.7% (in USD) for the period. Reflecting the rise in investor risk aversion during the period, defensivestocks such as utilities, telecommunications and consumer staples were the best-performing sectors as investors sought safe havens. Resource sectors, such as materials and energy, also outperformed as oil andother commodity prices stabilized. Cyclical stocks, such as financials, consumer discretionary and IT, lagged the benchmark.


As we head into the 2H16, we expect continued macroeconomic uncertainty and volatile markets. Theunpredictable consequences of Brexit introduces additional uncertainty for investors who are alreadychallenged with navigating moderate economic and earnings growth, as well as central bank monetary policies that have pushed interest rates to unprecedented low levels. In these markets, we believe thatinvestors should stay focused on high-conviction, active equity strategies that can successfully navigate theuncertainty. Bouts of volatility tend to produce mispricings that become attractive opportunities for activeinvestors to exploit.

The Portfolio combines our high-conviction value and growth strategies. Our value approach seeks to buyfuture cash earnings for the lowest price. The current gap between the cheapest and most expensivequintiles of stocks based on price to book value remains provocative, pointing to opportunities for valuestocks. Regional valuations remain diverse, with European and Japanese stock valuations below their long-term averages based on price-to-forward-earnings ratios, and US equites higher than the norm. Our growthapproach seeks to own companies that are well positioned to benefit from long-term secular trends, such as technological innovation, sustainable development, demographic change and emerging-market evolution, to achieve superior earnings growth and high returns on invested capital.

In a low-return world, even a small amount of alpha can go a long way. Across our equity services, webelieve that an active investment approach with differentiated research and high conviction can achievesuperior long-term results, even in the uncertain market conditions that investors are likely to face throughout2016.

^ Source: AllianceBernstein (Luxembourg) S.à r.l.


76


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception

(%) HSBC Insurance Global Equity Fund (1.27) (7.49) (9.82) 22.94 29.35 N.A. 30.70 Benchmark* 0.96 (4.51) (2.82) 29.81 51.11 N.A. 84.58†


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception

(%) HSBC Insurance Global Equity Fund 7.13 5.28 N.A. 3.53 Benchmark* 9.09 8.61 N.A. 8.32†

*MSCI World Net Index (in S$) †Performance of the benchmark is measured from closest month-end after inception throught 30 June 2016

^Inception Date: 16 Oct 2008


AllianceBernstein - Global Equity Blend Portfolio 100.06 67.08Other assets 0.03 0.02Other liabilities (0.09) (0.06)

Total 100.00 67.04



C) Underlying Sub-Fund Disclosure (AllianceBernstein- Global Equity Blend Portfolio) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

United States 48.44 201.84United Kingdom 6.68 27.84Japan 6.60 27.51France 5.33 22.20Switzerland 4.98 20.76China 4.25 17.72Netherlands 3.90 16.24Germany 2.06 8.60Belgium 2.06 8.58Others* 15.70 65.41

Total 100.00 416.70*Includes other countries and Other Assets less liabilities


77


Information Technology 21.27 88.54Financials 18.27 76.15Health Care 14.15 58.98Consumer Discretionary 13.19 54.95Consumer Staples 10.42 43.44Industrials 7.77 32.38Energy 4.07 16.98Telecommunication Services 3.65 15.21Materials 3.08 12.85Utilities 1.92 8.01Other assets less liabilities 2.21 9.21

Total 100.00 416.70



Roche Holding AG 1.85 7.73Partners Group Holding AG 1.21 5.05Apple, Inc. 1.11 4.62Wells Fargo & Co. 1.09 4.55Tencent Holdings Ltd. 1.08 4.49UnitedHealth Group, Inc. 1.07 4.45Safran SA 1.06 4.42Broadcom Ltd. 1.05 4.36Anheuser-Busch InBev SA/NV 1.02 4.27AIA Group Ltd. 1.02 4.25


Roche Holding AG 1.96 9.36Safran SA 1.29 6.16Wells Fargo & Co. 1.27 6.09Apple, Inc. 1.12 5.34British American Tobacco PLC 1.01 4.83Google, Inc. - Class C 0.99 4.72Pfizer, Inc. 0.98 4.69Anheuser-Busch InBev NV 0.97 4.65Liberty Global PLC - Series C 0.97 4.62AIA Group Ltd. 0.96 4.60

V Exposure to Derivatives As at 30 Jun 2016% of NAV 0.06%Market value (S$) 251,221Realised Gains / (Losses) (S$) -Unrealised Gains / (Losses) (S$) (1,694.59)

VI Borrowings of Net Asset Value As at 30 Jun 2016N.A


78

D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Global Equity


As at 30-Jun-16 As at 30-Jun-15 As at 29-Feb-16* As at 28-Feb-15** Expense Ratio 1.72% 1.79% 0.78% 0.79% Turnover Ratio 7.58% 6.18% 54.24% 58.03%

*Based on unaudited figures as at 29 Feb 2016 as the expense and turnover ratios for AllianceBernstein - Global Equity Blend Portfolio for the financial year ended 30 June 2016 is not available. **Based on unaudited figures as at 28 Feb 2015 as the expense and turnover ratios for AllianceBernstein - Global Equity Blend Portfolio for the financial year ended 30 June 2015 is not available.


III Material Information that will adversely impact the valuation of the ILP sub-fund Delist of AB - Global Equity Blend Portfolio from Central Provident Fund Investment Scheme ("CPFIS")

with effect from 31 August 2016. Following the delisting, the Portfolio will not be required to be managed in accordance with CPF Investment Guidelines. Please refer to Notice to CPFIS Shareholders of the Portfolio dated 29 April 2016 for more information.

IV Soft Dollar Commission Arrangement During the period ended June 30, 2016, although currently the Management Company does not receiveor enter into soft-dollar commissions/arrangements, the Investment Manager does receive and hasentered into soft-dollar commissions/arrangements with brokers relating to portfolios of the UnderlyingFund that invest in equity securities, in respect of which certain goods and services used to support theinvestment decision making process were received. The soft commission arrangements were entered intoon the basis that the execution of transactions on behalf of the Underlying Fund will be consistent withbest execution standards and brokerage rates will not be in excess of customary institutional full-servicebrokerage rates. The goods and services received include specialist industry, company and consumerresearch, portfolio and market analysis and computer software used for the delivery of such services. Thenature of the goods and seindrvices received is such that the benefits provided under the arrangementmust be those which assist in the provision of investment services to the Underlying Fund and maycontribute to an improvement in the Underlying Fund's performance. For the avoidance of doubt, suchgoods and services do not include travel, accommodations, entertainment, general administrative goodsor services, general office equipment or premises, membership fees, employees' salaries or direct moneypayments. Disclosure of soft commission arrangements will be made in the periodic reports of theUnderlying Fund.




HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Global Equity Index Fund

79

HSBC Insurance Global Equity Index Fund

Fund Objective

The Fund aims to track the HSBC Economic Scale Index World (the “Global Index”) by investing in securities that are included in the Global Index. The Optimised Replication strategy involves the acquisition of a subset of the component securities of the Global Index and possibly of some securities that are not included in the Global Index that are designed to help the Fund track the performance of the Global Index. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the HSBC Global Investment Funds – Economic Scale Index Global Equity Fund.


Funds – Economic Scale Index Global Equity Fund.



N.A.



Against a frequently turbulent backdrop, global markets ended the year down with the MSCI World (Net) (0.87%). The FED finally raised interest rates in December 2015, ending an extraordinary period of government intervention in the financial markets that started at the height of the recession. The global markets eased slightly after the FED rate hike, emerging markets were largely disappointing in 2015. Equities reacted favourably to the FED’s decision to hike interest rates for the first time since 2006, signalling faith in the strength of the US recovery. The price of oil fell to its lowest level in 11 years to around $36 per barrel in December 2015 as commodity markets responded to signs that the global slump may deepen in 2016.

In 2016 as the UK’s referendum on EU membership drew closer, markets became increasingly uncertain on the vote’s outcome. With markets having largely priced in a vote to remain, the subsequent result triggered a major sell-off in equities across the world. This was soon followed by a relief rally, amid a growing conviction that central banks would look to offset any slowdown with increased stimulus. In the US, markets were supported by a rally in the energy sector, as oil prices firmed during the quarter. Later in the period, the decreasing likelihood of further interest-rate rises also provided a boost to equities. Earlier in the period, Eurozone markets were bolstered by firming oil prices, somewhat improved sentiment towards China and broadly encouraging economic data from Europe. The UK’s vote to leave the EU prompted a big sell-off, but investors subsequently took heart from the likelihood of further stimulus. Japanese equities fell back as the yen strengthened, which threatened to make life more difficult for the country’s many exporters. In emerging markets, Latin American bourses rose on the back of improved commodity prices and reduced fears of imminent interest-rate rises in the US. emerging markets in Europe fared poorly, amid continued concerns over the Greek debt crisis and political issues in Poland.


Over the year the fund returned (5.15%) underperforming the MSCI World Net by (2.38%) to the end of June 2016. On the sector front, the relative underperformance was a result of stock selection (3.31%), mainly negative effects from over to Consumer Discretionary contributing a total effect of (1.12%) over the same period. Overall the contribution from sector selection was positive contributing 0.93% led by the underweight to Apple, overweight to Nippon Telegraph and Telephone and benchmark allocation to Valeant Pharmaceuticals.

On a country level, the relative underperformance was both selection (0.62%) and allocation effects (1.75%) mainly led by unweight allocation and stock selection to the US. The overweight allocations to Germany also detract from performance however, the underweight to Canada was positive.

Over the year the largest detractors to performance were led by underweights to Amazon and Facebook and the overweight to Volkswagen.



80


3-Mth(%)

6-Mth (%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

Since Inception ̂

(%) HSBC Insurance Global Equity Index Fund (0.61) N.A. N.A. N.A. N.A. N.A. 0.36

Benchmark* (0.29) N.A. N.A. N.A. N.A. N.A. 2.35

*HSBC Economic Scale Index World ^Inception Date: 02 Feb 2016


Asset Class % of NAV MV S$ milHSBC Global Investment Funds - Economic Scale Index Global Equity Fund 100.00 0.19Total 100.00 0.19

II Fund Movement (18 Jan 2016 - 30 Jun 2016) S$


C) Underlying Sub-Fund Disclosure (HSBC Global Investment Funds - Economic Scale Index Global Equity Fund)

I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil USA 44.97 106.58 Japan 12.83 30.41 United Kingdom 7.86 18.63 France 6.64 15.74 Germany 6.37 15.10 Others* 18.85 44.66 Cash 2.48 5.88


II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil Financials 16.20 38.41 Industrials 15.78 37.40 Consumer Discretionary 15.20 36.02 Consumer Staples 10.31 24.43 Information Technology 9.08 21.52 Health Care 7.39 17.51 Energy 7.33 17.37 Telecommunication Services 6.39 15.14 Materials 5.37 12.73 Utilities 4.47 10.59 Cash 2.48 5.88

Total 100.00 237.00



81

IV Top Ten Holdings of Underlying Sub- Fund As at 30 Jun 2016 % of NAV MV S$ mil

Wal-Mart Stores Inc 1.95 4.61 General Electric Co 1.10 2.61 Exxon Mobil Corp 1.03 2.44

At&T Inc 0.91 2.16 Royal Dutch Shell Plc-A Shs 0.86 2.04 Verizon Communications Inc 0.74 1.75 Volkswagen Ag 0.72 1.71 Nippon Telegraph & Telephone 0.70 1.66 Jpmorgan Chase & Co 0.64 1.52 Wells Fargo & Co 0.61 1.45

V Exposure to Derivatives As at 30 Jun 2016 % of NAV 0.92% Market value (S$) 2,186,953 Realised Gains / (Losses) (S$) - Unrealised Gains / (Losses) (S$) 14,580



Ratios HSBC Insurance Global Equity Index


As at 30-Jun-16 As at 31-Mar-16* Expense Ratio 0.94% 0.95% Turnover Ratio 4.25% 0.30% *Based on the unaudited figures as at 31 Mar 2016 as the expense and turnover ratios of HSBC Global Investment Funds - Economic Scale Index Global Equity Fund for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions HSBC Insurance Global Equity Index Fund S$0.19 million, equivalent to 100.00% of its net asset value in HSBC Global Investment Funds - Economic Scale Index Global Equity Fund, which is managed by HSBC Global Asset Management (Singapore) Ltd.






HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Global Equity Volatility Focused Fund

82

HSBC Insurance Global Equity Volatility Focused Fund

Fund Objective

HSBC Insurance Global Equity Volatility Focused Fund aims to provide long term total return by investing in a portfolio of equities worldwide. The Fund invests in normal market conditions a minimum of 90% of its net assets in equities and equity equivalent securities of companies domiciled or operating in both developed markets, such as OECD countries, and Emerging Markets. It may also invest in eligible closed-ended Real Estate Investment Trusts (“REITS”). Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the HSBC Global Investment – Global Equity Volatility Focused.


Funds – Global Equity Volatility Focused Fund



N.A.



Global equities fell 3.73% (USD returns, MSCI All Country World index) over the period. Returns were marked by periods of high volatility given concerns over global growth, commodity prices, and the UK’s referendum to leave the EU.

The portfolio declined 1.92% gross of fees, outperforming by 2.02%. One year portfolio volatility was 12.7% versus 15.3% for the global index, hence the portfolio delivered a higher Sharpe Ratio (i.e., better risk-adjusted returns) at (0.23) versus (0.27).

The portfolio benefitted from its lower volatility positioning. Stock selection was a key driver of returns.


We continue to favour risk assets such as global equities, corporate bonds and high-yield debt relative to developed market government bonds.

We see little impact on the global economy from the ‘Brexit’ vote and believe that the global economic recovery remains on track, driving global equity markets to deliver positive returns over the long-term. Overall, support from the continuation of incredibly accommodative monetary policy and the potential for looser fiscal policy will, in the medium and longer term, likely outweigh headwinds created by more modest Chinese growth, gradual tightening in US monetary policy and political uncertainty in many regions, not least Europe. Looking ahead, concerns may continue to flare, leading to episodic volatility.

Given a backdrop of heightened volatility and diverging fundamentals, we see an equity market environment where an active investment strategy combining Low Volatility, Quality, and Value can be advantageous in capturing long-term investment returns while navigating short-term uncertainties.



83


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Global Equity Volatility Focused Fund (0.39) N.A. N.A. N.A. N.A. N.A. 3.35

This fund has no benchmark. ^Inception Date: 01 Feb 2016


Asset Class % of NAV MV S$ mil HSBC Global Investment Funds – Global Equity Volatility Focused 100.00 0.02

Total 100.00 0.02



C) Underlying Sub-Fund Disclosure (HSBC Global Investment Funds – Global Equity Volatility Focused)

I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil USA 52.19 196.12 Japan 10.95 41.15 United Kingdom 9.37 35.21 Germany 3.74 14.05 Switzerland 3.43 12.89 China 3.31 12.44

Australia 3.23 12.14 Others* 11.02 41.41 Cash 2.76 10.37


II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil Financials 17.72 66.59 Consumer Staples 16.80 63.13 Information Technology 14.86 55.84 Industrials 14.47 54.38 Consumer Discretionary 14.27 53.62 Health Care 8.66 32.54 Telecommunication Services 5.33 20.03 Energy 3.53 13.27 Others* 1.60 6.01 Cash 2.76 10.37




84


Altria Group Inc 2.47 9.29 Dr Pepper Snapple Group Inc 2.46 9.24 Travelers Cos Inc/The 2.44 9.17 Compass Group Plc 2.42 9.09 Kimberly-Clark Corp 2.42 9.09 Johnson & Johnson 2.41 9.06 Hca Holdings Inc 2.35 8.83

Autozone Inc 2.27 8.53 Exxon Mobil Corp 2.24 8.42 Dollar General Corp 2.21 8.30

V Exposure to Derivatives As at 30 Jun 2016 % of NAV 0.08% Market value (S$) 295,284 Realised Gains / (Losses) (S$) - Unrealised Gains / (Losses) (S$) 252,373



Ratios HSBC Insurance Global Equity

Volatility Focused Fund Underlying Sub-Fund As at 30-Jun-16 As at 31-Mar-16*

Expense Ratio 1.90% 1.92% As at 30-Jun-16

Turnover Ratio 281.98% 0.54% *Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of HSBC Global Investment Funds – Global Equity Volatility Focused for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions HSBC Insurance Global Equity Volatility Focused Fund S$0.02 million, equivalent to 100.00% of its netasset value in HSBC Global Investment Funds – Global Equity Volatility Focused, which is managed by HSBC Global Asset Management (Singapore) Ltd.






HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Global High Income Bond Fund

85

HSBC Insurance Global High Income Bond Fund

Fund Objective

HSBC Insurance Global High Income Bond Fund invests for high income primarily in a diversified portfolio of higher yielding fixed income bonds and other similar securities from around the world denominated in a range of currencies. This may include Investment Grade bonds, high yield bonds and Asian and Emerging Markets debt instruments. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the HSBC Global Investment Funds – Global High Income Bond Hedge Fund.


Funds – Global High Income Bond Hedge Fund



N.A.



Global credit markets were down in 2015 and through the beginning of 2016 amidst concerns over global growth and the decline in oil prices. Credit markets then rebounded in mid-February as talk of reduced oil output sparked a rally in the price of oil. Signs of continued US economic growth also helped buoy investor sentiment along with additional monetary stimulus from central banks in Europe and Japan. The period ended with volatility in June as the markets reacted to the UK vote to leave the EU. Risk appetite fell and economic uncertainty of the decision led investors to move toward safe haven assets.


The main overweight remains in asset backed securities (ABS) and the main underweight is in US investment grade. Within USD bonds, we have slightly increased our exposure to the US BBB sleeve and still have a preference for lower rated credit within both US sleeves. We continue to favour the ABS market as characterized by a higher yielding and lower duration asset class with current valuations at attractive levels.

The strategy is underweight emerging markets energy while slightly overweight higher quality producers in the US with a focus on low cost and well-hedged entities. The strategy is overweight financials, primarily in USD and Euro bonds with an underweight to financials in the emerging markets sleeve. We believe these issuers are able to withstand the potential lower growth scenario that Brexit implies.

With yields still low, we have maintained an underweight duration positioning relative to the benchmark.



3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Global High Income Bond Fund 2.53 N.A. N.A. N.A. N.A. N.A. 6.86


*35% EMD Barclays Emerging Markets USD Index +20% Barcap U.S Corp Baa + 15% Barcap US High Yield Ba + 15% BarCap EuroAgg Corporate BaaUSD Hedged + 15% BarCap Euro HY BB Rating Only USD Hedged. ^Inception Date: 25 Jan 2016


86


Asset Class % of NAV MV S$ mil HSBC Global Investment Funds – Global High Income Bond 100.00 0.05

Total 100.00 0.05



C) Underlying Sub-Fund Disclosure (HSBC Global Investment Funds – Global High Income Bond) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil United States 36.61 913.14 France 5.31 132.56 Germany 4.67 116.49 Brazil 4.17 103.97 Mexico 4.12 102.87 United Kingdom 4.07 101.58 Italy 2.67 66.65 China 2.65 66.03 Netherlands 2.11 52.68 Others* 33.62 838.54


II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil Financial Institutions 20.29 506.14 Sovereign 13.47 335.98

Agencies 7.52 187.66 Communications 6.89 171.90 CMBS 6.51 162.30 Consumer Cyclical 5.51 137.50 Capital Goods 4.35 108.52 Energy 4.17 104.05 Basic Industry 3.92 97.81 Consumer Non-Cyclical 3.91 97.50 Others* 9.11 227.12 Cash 14.35 358.03


III Allocation of Debt Securities by Credit Ratings As at 30 Jun 2016 (For Debt securities portfolio only)

AAA 0.98 24.76AA 0.00 0.01A 8.23 205.25BBB 38.78 967.27BB 27.97 697.62B 7.67 191.22CCC 0.82 20.54CC 0.00 (0.10)Unrated 1.20 29.91

Total 85.65 2,136.48


87


Brazil (FED Rep of)-Global 4.875% 22/01/21 0.93 23.12 Turkey (Republic of) 5.125% 25/03/22 0.64 16.06 Republic of Indonesia 3.75% 25/04/22 0.54 13.56 CNOOC Finance 2013 Ltd 3% 09/05/23 0.52 13.02 Colombia (Rep of)-Global 4.375% 12/07/21 0.52 12.86 Kazakhstan (Republic of) 5.125% 21/07/25 0.51 12.75 US Treasury Bonds 2.5% 15/02/46 0.49 12.19 Petrobras Intl Finance 5.875% 01/03/18 0.47 11.84 Hungary Republic of - Global 6.25% 29/01/20 0.42 10.54 Petrobras Intl Finance 5.75% 20/01/20 0.42 10.45

V Exposure to Derivatives As at 30 Jun 2016 % of NAV 1.10% Market value (S$) 27,346,827 Realised Gains / (Losses) (S$) - Unrealised Gains / (Losses) (S$) 27,346,827



Ratios HSBC Insurance Global High Income

Bond Fund Underlying Sub-Fund


As at 30-Jun-16 Turnover Ratio 171.62% 0.35% *Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of HSBC Global Investment Funds – Global High Income Bond for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions HSBC Insurance Global High Income Bond Fund S$0.05 million, equivalent to 100.00% of its net asset value in HSBC Global Investment Funds – Global High Income Bond, which is managed by HSBC Global Asset Management (Singapore) Ltd.






HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Global Multi-Asset Fund

88

HSBC Insurance Global Multi-Asset Fund

Fund Objective

HSBC Insurance Global Multi-Asset seeks to achieve the investment objective by actively allocating between equity securities of companies globally, which offer attractive yields and sustainable dividend payments, global bonds and other fixed or floating rate securities (including, but not limited to, asset-backed securities and mortgage-backed securities) issued by governments, government agencies, supra-national or corporate issuers which offer attractive yields, cash (which will be treated as a separate asset class and will be deployed if necessary to limit downside risk during adverse market conditions) and Alternative Asset Classes


Selection Fund – Global Multi-Asset Income


Launch Date 18 Jan 2016 CPFIS/SRS* SRS CPFIS Risk Classification

N.A.


indirectly through ETFs, REITs and/or eligible derivative transactions. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the Schroder International Selection Fund Global Multi-Asset Income.


The period under review got off to a volatile start as markets fretted about the extent of the economic slowdown in China and the rest of the emerging world, and what that might mean for global growth. Equity markets registered losses across the board over the 3Q15, with emerging markets registering particularly sharp declines. Uncertainty about a US interest rate hike, concerns about the health of the Chinese economy, political risk and commodity price weakness all contributed to risk aversion. Against this backdrop, global bonds were broadly positive as investors sought out "safe havens". Global government bond yields were almost universally lower over the quarter. Investment grade corporate bonds inched into positive territory, although high yield bonds struggled. Equity markets' trajectory during the 1Q16 was V-shaped, initially plunging to multi-year lows then rebounding sharply over the final six weeks. The actions of central banks and a recovery in the oil price were important contributors to the market turnaround amid a marked recovery in investors’ appetite for risk. The market responded positively as forecasts for additional increases in US interest rates were deferred following dovish comments from FED’s chair Janet Yellen. Meanwhile, the ECB announced fresh monetary policy easing in early March. Markets made a confident start to the 2Q16 but the UK’s vote to leave the EU overshadowed other market drivers by the end of June. Equity market performance was mixed, while government bond yields were sharply lower.


Brexit does not alter our cautious outlook for global economic growth as we expect volatility to remain elevated in financial markets. We maintain our preference for high risk adjusted carry strategies as income is likely to be the largest component of total returns for investors this year. The portfolio remains defensively positioned with a preference for credit over equities. We maintain our barbell strategy which allows us the necessary flexibility to navigate this market environment. In this context we have rotated some of our government bond exposure into emerging market debt which is more attractively valued.



3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Global Multi-Asset Fund 1.34 N.A. N.A. N.A. N.A. N.A. 1.74

This fund has no benchmark. ^Inception Date: 21 Mar 2016


89


Asset Class % of NAV MV S$ mil Schroder International Selection Fund - Global Multi-Asset Income 100.00 0.03

Total 100.00 0.03



C) Underlying Sub-Fund Disclosure (Schroder International Selection Fund - Global Multi-Asset Income)

I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil North America 41.40 2,498.81 Emerging Markets 27.20 1,641.73 Europe 15.10 911.40 UK 10.20 615.65

Asia Pacific ex-Japan 2.90 175.04 Japan 1.50 90.54 Others* 1.70 102.60


II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil Government 27.50 1,659.84 Diversified Financials 15.30 923.47 Consumer Discretionary 8.00 482.86 Industrials 7.10 428.54 Telecommunication Services 5.90 356.11 Consumer Staples 5.70 344.04 Health Care 5.70 344.04 Energy 5.20 313.86 Information Technology 5.20 313.86 Materials 4.20 253.50 Others* (6.20) (374.22) Cash 16.40 989.87


III Allocation of Debt Securities by Credit Ratings As at 30 Jun 2016Rating % of NAV MV S$ mil

AAA / Aaa 1.46 88.12AA+ / Aa1 7.39 446.04AA / Aa2 2.07 124.94AA- / Aa3 0.13 7.85A+ / A1 0.27 16.30A / A2 1.76 106.23A- / A3 2.42 146.07

BBB+ / Baa1 2.69 162.36 BBB / Baa2 3.72 224.53 BBB- / Baa3 4.67 281.87 BB+ / Ba1 7.29 440.01 BB / Ba2 5.58 336.80 BB- / Ba3 4.49 271.01 Unrated 2.20 132.79 Others* 14.65 883.62

Total 60.79 3,668.54


90


Indonesia Government 6.125% 15/05/2028 0.60 36.21 Gcp Infrastructure Investments 0.50 30.18 International Public Partnerships 0.50 30.18 Italy Btps 5.5% 01/09/2022 0.50 30.18 Nota Do Tesouro Nacional 10% 01/01/2023 0.50 30.18 South Africa (Rep) 6.25% 31/03/2036 0.50 30.18 Starwood European Real Estate Finance 0.50 30.18 Thailand Government Bond 3.65% 17/12/2021 0.50 30.18 Mexican Bonos De Desarrollo 7.75% 29/05/2031 0.40 24.14 Schroder European Real Estate Investment Trust Plc 0.40 24.14

V Exposure to Derivatives As at 30 Jun 2016 % of NAV 0.27% Market value (S$) 16,379,400 Realised Gains / (Losses) (S$) (2,972,356) Unrealised Gains / (Losses) (S$) 16,379,400



Ratios HSBC Insurance Global Multi-Asset

FundUnderlying Sub-Fund


As at 30-Jun-16 Turnover Ratio 172.64% 96.47% *Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Schroder International Selection Fund - Global Multi-Asset Income for the financial year ended 30 Jun 2016 is not available.



IV Soft Dollar Commission Agreement Each Investment Manager may enter into soft commission arrangements only where there is a direct and identifiable benefit to the clients of the Investment Manager, including the relevant Sub-Fund, and where the Investment Manager is satisfied that the transactions generating the soft commissions are made in good faith, in strict compliance with applicable regulatory requirements and in the best interests of the relevant Sub-Fund. Any such arrangements must be made by the Investment Manager on terms commensurate with best market practice.



HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance India Equity Fund

91

HSBC Insurance India Equity Fund

Fund Objective

HSBC Insurance India Equity Fund seeks long-term capital growth through a diversified portfolio ofinvestments in equity and equity-equivalent securities of companies registered in, and/or with an official listing on a major stock exchange or other regulated market of India, as well as those with significant operations in India. Fund investments are made by way of a feeder fund through the HSBC Global Investment Funds - Indian Equity.


Market recorded a loss in USD terms over the 12-month period. The Indian market fell in 2H15 amid heightened global equity market volatility largely


Funds - Indian Equity Fund Fund Manager HSBC Global Asset

Management (Singapore) Limited

Launch Date 19 Apr 2004 CPFIS/SRS* SRS CPFIS Risk Classification

N.A.


*Note: With effect from 1 Mar 2014, the Fund has been delisted from CPFIS.

driven by news flow from China and an acknowledgment that China would most likely sustain slower growth than it has in the past. While the continuing easing of monetary policy by the RBI was supportive of the equity market, the transmission of cuts into the real economy has been hampered by banks being slow to follow suitin their rates. Earnings results in India were generally reviewed as disappointing as was the pace of policyreform. The Indian market endured a tough start to 2016 due to concerns around slowing economic activity,the collapse of the China A-share market, the volatility of the RMB and the continued fall in oil prices. Compounding the situation in India was a lack of positive domestic newsflow, a lackluster earnings seasonand the slow pace of reform. However, market started to bounce back in March and going into the 2Q16 on the back of monetary policy easing, a better-than-expected March 2016 earnings season and positivedomestic news flows.

The Fund lost ground in absolute terms and underperformed the market purely due to stock selection.Selection in industrials was a notable contributor to relative performance, but the positive was outweighed bythe drag from the investment in the more cyclical sectors such as financials and energy. Meanwhile, sectorallocation was roughly flat during the quarter.


Key factors to look out for in the short to medium term are the monsoon rainfall trends and the policyroadmap of the Government. Domestic variables are on an improving trend and with an expected supportivepolicy environment these are likely to improve further. We have seen improvements in the macro data pointsover the past 2 years and the budget policy document has laid out a fiscal roadmap reaffirming government’sfocus on the fiscal consolidation front. We continue to believe that India is on a relatively better footing macro-wise vis-à-vis other emerging markets. However, the pace of this macro improvement translating toresults on the ground has lagged expectations due to a sluggish pick-up in the investment cycle given overcapacity issue. Growth has faced headwinds from the slower-than-expected pace of corporate deleveraging, and unforeseeable external factors, such as two years of bad monsoon and lack of globalaggregate demand, have further delayed the expected economic recovery in India. Government has done its fair bit to improve the investment environment but has remained constrained on reforms requiring legislativeaction, as they lacked numbers in the Upper House of the Parliament. But this scenario is expected toimprove going forward, on the back of recent state assembly election adjustments and we may see morepolicy reform announcements going forward, especially the key tax reform possibility, the goods and services tax (GST). An above normal monsoon season should help in reviving the rural demand and that rounds up an optimistic year ahead from a domestic perspective.



92


3-Mth (%)

6-Mth (%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

Since Inception ̂

(%) HSBC Insurance India Equity Fund 3.59 (8.94) (10.88) 25.14 (9.36) 17.04 108.57 Benchmark* 5.18 (3.63) (4.30) 46.10 17.21 76.71 236.73 II Average Annual Compounded Returns

3-Year(%)

5-Year(%)

10-Year(%)

Since Inception ̂

(%) HSBC Insurance India Equity Fund 7.76 (1.95) 1.59 6.24 Benchmark* 13.47 3.23 5.86 10.52

*S&P/IFC Investible India Index (SGD) ^Inception Date: 14 May 2004


HSBC Global Investment Funds - Indian Equity Fund 100.02 55.01 Other assets 0.33 0.18 Other liabilities (0.35) (0.19)

Total 100.00 55.00



C) Underlying Sub-Fund Disclosure (HSBC Global Investment Funds - Indian Equity Fund) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

India 95.47 2,100.98 Cash 4.53 99.69

Total 100.00 2,200.67


Financials 28.28 622.35 Information Technology 16.31 358.93 Consumer Discretionary 14.05 309.19 Industrials 8.24 181.34 Energy 7.93 174.51 Consumer Staples 6.91 152.07 Health Care 5.34 117.52 Materials 5.17 113.77 Utilities 3.24 71.30 Cash 4.53 99.69

Total 100.00 2,200.67



93


Infosys Ltd 7.98 175.61 Axis Bank Limited 5.31 116.86 Itc Ltd 5.15 113.33 Icici Bank Ltd 5.00 110.03 Maruti Suzuki India Ltd 4.61 101.45 Tata Motors Ltd 4.31 94.85 Hcl Technologies Ltd 4.06 89.35 Housing Development Finance 3.93 86.49 Wipro Ltd 3.14 69.10 Hdfc Bank Limited 2.88 63.38


ICICI Bank Ltd Ordinary INR 2.00 (Scripless) 6.31 180.50 Axis Bank Limited 5.52 157.88 HCL Technologies Ltd Ordinary INR 2.0 (Scripless) (A/G) 5.43 155.33 Tata Motors Ltd A Shs Ord INR2 (DVR) (10 A Shs Entitled To 1 Voting Right) 5.06 144.69 Oil & Natural Gas Corp INR 5 (Scripless) 4.80 137.44 Maruti Suzuki India Ltd INR 5.0 (Scripless) (A/G) 4.80 137.39 Wipro Limited Ordinary INR 2.00 (Scripless) 4.27 122.07 ITC Ltd Ord INR (Scripless)(Frmly INR 10) (A/G) 3.62 103.49 Infosys Ltd-SP ADR (1 ADR = 1 Ord Shs) 3.49 99.91 Indiabulls Housing Finance Ltd INR 2.00 (Scripless) 3.49 99.70



D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance India Equity




*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of HSBC Global Investment Funds - Indian Equity Fund for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions HSBC Insurance India Equity Fund S$55.01 million, equivalent to 100.02% of its net asset value in HSBC Global Investment Funds- Indian Equity Fund, which is managed by HSBC Global Asset Management (Singapore) Ltd. The management fees earned by HSBC Global Asset Management (Singapore) Ltd from 01 July 2015 to 30 June 2016 amounts to S$276,391.




94



HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Japan Equity Fund

95

HSBC Insurance Japan Equity Fund

Fund Objective

HSBC Insurance Japan Equity Fund seeks to achieve capital growth primarily through investment in equity securities of Japanese companies. Fund investments are made by way of a feeder fund, which invests substantially all, or all its assets in the Schroder International Selection Fund Japanese Equity.


Japan equities fell heavily, in yen terms, over the period as a stronger yen amid global uncertainty weighed on the stockmarket. Shares experienced a rough start on the back of RMB devaluation in August, which raised concerns over a Chinese economic slowdown and its impact on Japan. Global markets were weak with foreign investors being significant sellers in the Japanese market. Then after bouncing back in October, shares were negatively


Selection Fund - Japanese Equity



N.A.


Note: With effect from 10 Apr 2015, the underlying sub-fund of HSBC Insurance Japan Equity Fund was changed from Schroder International Choice Portfolio -Schroder Japanese Equity to Schroder International Selection Fund Japanese Equity.

by lacklustre growth figures and disappointing easing measures announced by the ECB late in 2015. In the new year, initial weakness was driven primarily by external factors, including renewed concerns over global economic growth. Thereafter, market dynamics were dominated by the BoJ unexpected move to a negative interest rate policy at the end of January.

The final quarter saw equity and currency markets largely influenced by just two events. During April, the consensus expectation had formed solidly behind the view that the central bank would extend its negative interest rate policy which had been introduced in January, and also extend its asset purchase programme. In the event, the decision of the central bank to take no action, which was announced on the last trading day of April, constituted a major surprise. This was followed in late June by an external shock delivered by the UK referendum result which created further uncertainty and accelerated the appreciation of the yen.


Japan’s economic data have been somewhat better than expected recently and this trend continued in June, although inflation measures remained sluggish. Although only limited parts of Japan’s economy have any direct impact from the UK referendum result, the outlook for the stock market been thrown into short-term uncertainty by the strength of the currency. In one sense this was already an issue for investors as the yen has been appreciating gradually throughout the 1H16. However, the size and speed of the move on June 24th, and the proximity of the psychological level of 100 against the dollar, has brought the issue sharply into focus though interest rate differentials may argue in favour of a weaker yen.

We believe the Japanese market has largely discounted the potential negative impact of the stronger yen on earnings but sentiment remains highly sensitive to the yen/dollar exchange rate. Given the current level of the yen, overall corporate earnings are expected to be flattish or show a small decline for the current fiscal year unless the global economy gathers positive momentum. Excluding this currency impact, we expect underlying earnings to hold up well as many companies are keeping a relatively tight control on costs and we believe dividends can be maintained even if earnings growth is revised down. Going forward, we also expect greater investor engagement with companies as well as changing attitude of management will continue to encourage higher dividend pay-outs and share buy-backs and to reinforce the focus on return of equity.



96


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Japan Equity Fund (7.85) (23.91) (25.07) (7.98) 4.02 (33.76) (28.67) Benchmark* (7.29) (22.31) (21.66) 2.59 20.49 (22.67) (18.05)


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Japan Equity Fund (2.74) 0.79 (4.04) (3.11) Benchmark* 0.85 3.80 (2.54) (1.85)

*TSE First Section Index (TOPIX) ^ Inception Date:28 Oct 2005


Schroder International Selection Fund - Japanese Equity 99.61 2.55Other assets 0.39 0.01

Total 100.00 2.56



C) Underlying Sub-Fund Disclosure (Schroder International Selection Fund - Japanese Equity) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

Japan 97.42 3,611.19Liquid Assets 2.58 95.64

Total 100.00 3,706.83


Information & Communication 13.21 489.67Electric Appliances 10.51 389.59Pharmaceutical 8.85 328.05Transportation Equipment 8.78 325.46Banks 6.87 254.66Retail Trade 5.97 221.30Machinery 5.51 204.25Wholesale Trade 4.56 169.03Construction 3.90 144.57Land Transportation 2.87 106.37Others* 26.39 978.22Liquid Assets 2.58 95.64

Total 100.00 3,706.83*Includes other industries.



97


KDDI 4.53 167.92Sumitomo Mitsui Financial Group 3.04 112.69Astellas Pharma 2.97 110.09Japan Tobacco 2.81 104.16Nippon Telegraph & Telephone 2.72 100.83Isuzu Motors 2.54 94.15Orix 2.50 92.67Toyota Motor 2.47 91.56Mitsubishi UFJ Financial Group 2.46 91.19Bridgestone 2.38 88.22


Toyota Motor 4.45 204.14Sumitomo Mitsui Financial Group 4.37 200.47Mitsubishi UFJ Financial Group 3.75 172.03KDDI 3.52 161.48Orix 2.69 123.40Japan Tobacco 2.58 118.36Bridgestone 2.47 113.31Kubota 2.42 111.02Hitachi 2.37 108.72Japan Airlines 2.32 106.43

V Exposure to Derivatives As at 30 Jun 2016% of NAV (1.91%)Market value (S$) (70,866,658)Realised Gains / (Losses) (S$) (349,906,912)Unrealised Gains / (Losses) (S$) (70,866,658)


D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Japan Equity

FundUnderlying Sub-Fund

As at 30-Jun-16 As at 30-Jun-15 As at 31-Mar-16* As at 30-Jun-15Expense Ratio 1.70% 1.93% 1.66% 1.66%

As at 30-Jun-16Turnover Ratio 9.21% 13.74% 39.96% 61.25%*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Schroder International Selection Fund - Japanese Equity for the financial year ended 30 Jun 2016 is not available.




98





HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Pacific Equity Fund

99

HSBC Insurance Pacific Equity Fund

Fund Objective

HSBC Insurance Pacific Equity Fund aims to provide holders with medium to long-term capital growth from a diversified portfolio of Asian-Pacific equities excluding Japanese equities. Fund investments are made by way of a feeder fund, which invests substantially all, or all its assets in the Aberdeen Select Portfolio – Aberdeen Pacific Equity Fund.


Most Asian markets fell on the back of heightened volatility during the year under review, with the UK’s

FUND FACTS Underlying Sub-Fund Aberdeen Select Portfolio -

Aberdeen Pacific Equity Fund Fund Manager Aberdeen Asset Management

Asia Limited Launch Date 01 Apr 2010 CPFIS/SRS OA/SRS CPFIS Risk Classification

Higher Risk – Narrowly Focused - Regional - Asia


shock vote to leave the EU among the major drivers of sentiment. At first, a key source of turbulence wasChina, as a domestic stock rout amid a crackdown on margin trading unsettled global markets, with an unexpected move to devalue the RMB amplifying fears over the mainland economy. Markets subsequentlyregained some ground on hopes of more bank stimulus. Expectations of a US rate hike buoyed the USD, which hurt commodities as well as currencies of emerging markets.

Then, the most telegraphed policy move finally occurred: the FED raised interest rates for the first time inalmost a decade. While this alleviated uncertainty, markets suffered a tumultuous start to 2016, owing toglobal growth concerns and tumbling oil prices. Stocks rebounded on the back of better data from emergingeconomies and steadier commodity prices.

Thereafter, however, resurgent US rate hike worries and renewed weakness in China’s economy tested the nerves of investors. This was followed by further bad news, as MSCI further delayed including A-shares in its indexes. More significantly, the UK referendum result sparked a global sell-off, although continental equities fared the worst. Towards the period-end, losses in Asia were mitigated by a late rally on hopes that major central banks would help stabilise financial markets.


There is still deep anxiety over potential Brexit fallout. Bond yields continue to fall and stockmarkets remain nervous. The FED has also turned more cautious, with some policymakers urging patience with interest ratehikes. In Asia, central banks have signalled a willingness to support markets where necessary, while thelong-term ramifications for Asian economies remain unclear.

In terms of our portfolios, while earnings may be affected in the short term, we think our holdings have what ittakes to survive and build on such uncertain times, given their management quality, sustainable businesses and robust balance sheets. We continue to be opportunistic, capitalising on any anomalies in prices to add toour preferred holdings on weakness or to pare them when valuations have run up too high. More broadly, ourpremise for investing in Asia remains intact. The region’s long-term fundamentals are reasonably solid, withstronger buffers, compared to other parts of the world.

^ Source: Aberdeen Asset Management Asia Limited


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Pacific Equity Fund 2.99 (1.19) (10.86) (3.58) 5.91 N.A. 13.07 Benchmark* 0.51 (2.76) (10.04) 12.00 10.98 N.A. 12.48


100


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Pacific Equity Fund (1.21) 1.15 N.A. 1.99 Benchmark* 3.85 2.11 N.A. 1.90

*MSCI AC Asia Pacific ex Japan Index ^Inception Date: 06 Apr 2010

B) Fund Disclosure As at 30 Jun 2016I Allocation by Asset Class % of NAV MV S$ mil Asset Class 99.91 109.54

Aberdeen Select Portfolio - Aberdeen Pacific Equity Fund 0.14 0.15Other assets (0.05) (0.05)Other liabilities 100.00 109.64

Total



C) Underlying Sub-Fund Disclosure (Aberdeen Select Portfolio - Aberdeen Pacific Equity Fund)I Allocation by Country As at 31 Mar 2016 Country % of NAV MV S$ mil

Singapore 19.08 253.52Hong Kong 12.70 168.70India 10.76 142.96China 9.11 121.04United Kingdom 8.89 118.19South Korea 6.95 92.38Australia 6.40 85.06Taiwan 6.19 82.31Others* 17.31 229.91Cash 2.61 34.72

Total 100.00 1,328.79*Includes other countries

II Allocation by Industry As at 31 Mar 2016 Industry % of NAV MV S$ mil

Unit Trusts 40.47 537.84Financials 27.38 363.80Information Technology 9.90 131.49Industrials 7.33 97.41Materials 5.00 66.42Telecommunication Services 3.05 40.52Healthcare 2.07 27.45Consumer Staples 1.22 16.20Consumer Discretionary 0.58 7.76Energy 0.39 5.18Cash 2.61 34.72

Total 100.00 1,328.79

III Allocation of Debt Securities by Credit Ratings As at 31 Mar 2016 N.A.


101

As at 31 Mar 2016IV Top Ten Holdings of Underlying Sub-Fund % of NAV MV S$ mil

Aberdeen Singapore Equity Fund 9.73 129.31Aberdeen Global -Indian Equity Fund^ 9.64 128.12Aberdeen China Opportunities Fund 8.72 115.86Samsung Electronics (Preference Shares) 5.73 76.19Aberdeen Thailand Equity Fund 4.31 57.27Taiwan Semiconductor Manufacturing Company 4.16 55.30Aberdeen Indonesia Equity Fund 4.12 54.80Aberdeen Malaysian Equity Fund 3.95 52.48Jardine Strategic Holdings 3.55 47.18AIA Group 3.08 40.94


Aberdeen Singapore Equity Fund 9.77 153.36 Aberdeen Global - Indian Equity Fund^ 9.51 149.20 Aberdeen China Opportunities Fund 8.91 139.75 Samsung Electronics (Pref) 4.89 76.72 Aberdeen Indonesia Equity Fund 3.97 62.30 Aberdeen Thailand Equity Fund 3.97 62.29 HSBC Holdings 3.49 54.71 Aberdeen Malaysian Equity Fund 3.47 54.41 AIA Group 3.44 54.01 Rio Tinto 3.25 51.04 ^ The underlying fund is not authorized for public sale in Singapore

V Exposure to Derivatives As at 31 Mar 2016N.A.

VI Borrowings of Net Asset Value As at 31 Mar 2016N.A.

D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Pacific Equity


As at 30-Jun-16 As at 30-Jun-15 As at 31-Mar-16*As at 30-Mar-15** Expense Ratio 1.74% 1.80% 1.78% 1.76% Turnover Ratio 7.18% 10.64% 1.66% 1.22%

*Based on the unaudited figures as at 31 Mar 2016 as the expense and turnover ratios of Aberdeen Select Portfolio - Aberdeen Pacific Equity Fund for the financial year ended 30 Jun 2016 is not available. **Based on the unaudited figures as at 30 Mar 2015 as the expense and turnover ratios of Aberdeen Pacific Equity Fund for the financial year ended 30 June 2015 are not available.

II Related-Party Transactions Cash balances maintained with HSBC Bank as at 30 June 2016 amounts to S$38,530.




102



HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Premium Balanced Fund

103

HSBC Insurance Premium Balanced Fund

Fund Objective

HSBC Insurance Premium Balanced Fund seeks to achieve long-term capital growth by investing in a diversified portfolio of securities. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the Deutsche Premier Select Trust.


The 2H15 showed solid growth in most regions. In the US GDP and a number of macroeconomic

FUND FACTS Underlying Fund Deutsche Premier Select Trust Fund Manager Deutsche Asset Management

(Asia) Limited Launch Date 02 Jan 2001 CPFIS/SRS OA/SA/SRS CPFIS Risk Classification

Medium to High Risk - Broadly Diversified


indicators improved significantly. However, in China concerns about the economy persisted. The year 2016 started with the most negative market movements in years. A number of concerns became apparent andequity and commodity prices retreated on a broad front. At the same time USTs gained massively as market participants fled riskier assets. Positive macroeconomic data, a positive reporting season and support fromstabilizing oil price the recovery of equity markets started quickly. At the end of the reporting period thedecision of the UK electorate to vote for leaving the EU brought additional volatility for financial markets.

Deutsche Premier Select Trust showed a performance of -4.8% in the reporting period. The Lion Bond Fundshowed a solid performance of +2.2%. Among the equity investments DWS Global Equity Focus returned -6.1% while the Deutsche Asian Small/Mid Cap was down -11.6% and the Deutsche Singapore Equity Fundat -9.1% (all numbers in SGD).


We have taken a more prudent stance in 2016 with a lower equity exposure compared to the previous years. Even though we still expect a macroeconomic recovery, global growth might remain lower for a longer periodof time. Given extreme levels of yields for fixed income investments, equities might still show relatively betterreturns, but risks remain and volatility should remain higher than in the past.



3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Premium Balanced Fund 0.05 (2.77) (4.90) 7.03 14.27 25.22 50.53

Benchmark* 0.59 (0.87) (3.49) 10.33 18.91 37.85 67.51


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Premium Balanced Fund 2.29 2.70 2.27 2.69 Benchmark* 3.33 3.52 3.26 3.41

*30% MSCI Singapore + 30% MSCI World+ 40% 3-month SIBOR ^Inception Date: 13 Feb 2001


104


Asset Class % of NAV MV S$ mil Deutsche Premier Select Trust 99.99 113.04 Other assets 0.10 0.11 Other liabilities (0.09) (0.10)

Total 100.00 113.05



C) Underlying Fund Disclosure (Deutsche Premier Select Trust) I Allocation by Country As at 30 Jun 2016

Country % of NAV MV S$ mil Singapore 65.20 118.19 Luxembourg 28.78 52.17 United States of America 4.56 8.27 Other net assets 1.46 2.65

Total 100.00 181.28


Unit Trusts/Mutual Funds 98.54 178.63 Other net assets 1.46 2.65

Total 100.00 181.28 III Allocation of Debt Securities by Credit Ratings As at 30 Jun 2016 N.A. IV Top Ten Holdings of Underlying Fund^ As at 30 Jun 2016

% of NAV MV S$ mil Deutsche Lion Bond Fund Class M 35.82 64.94 Deutsche Global Equity Focus Fund 28.78 52.17 Deutsche Singapore Equity Fund Class M 21.22 38.47 Deutsche Asian Small/Mid Cap Fund Class A 8.16 14.79 iShares iBoxx $ High Yield Corporate Bond ETF 2.98 5.41 SPDR Gold Trust ETF 1.58 2.86

Top Ten Holdings of Underlying Fund^ As at 30 Jun 2015 % of NAV MV S$ mil

Deutsche Lion Bond Fund Class M 31.70 62.65 Deutsche Global Equity Focus Fund 27.38 54.11 Deutsche Singapore Equity Fund Class M 22.24 43.95 Deutsche Asian Small/Mid Cap Fund Class A 8.52 16.83

Aberdeen Global Opportunities Fund SGD Class 3.95 7.81

^Less than Ten Holdings in the Underlying Fund.

V Exposure to Derivatives As at 30 Jun 2016 % of NAV - Market value (S$) - Realised Gains / (Losses) (S$) 10,400 Unrealised Gains / (Losses) (S$) - VI Borrowings of Net Asset Value As at 30 Jun 2016

N.A.


105

D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Premium

Balanced Fund Underlying Fund

As at 30-Jun-16 As at 30-Jun-15 As at 30-Mar-16* As at 30-Jun-15 Expense Ratio 1.54% 1.66% 1.38% 1.45% As at 30-Jun-16 Turnover Ratio 6.95% 6.54% 20.75% 23.94%

*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Deutsche Premier Select Trust for the financial year ended 30 Jun 2016 is not available.



IV Soft Dollar Commission Arrangement Soft dollar commissions are benefits accorded to Manager by their brokers, usually in the form ofresearch, advisory, analysis and data services, computer hardware or software used for and/or in supportof the investment process.

The Manager’s policy on soft dollar commissions is as follows: - the goods and services received would assist in the provision of investment services and advices orrelated services to the unit trust; - transactions are executed on the best available terms; and - the Manager does not engage in unnecessary trades in order to qualify for soft dollar commissions.

Soft dollar commissions were received from the Manager’s panel of soft dollar brokers which executedtransactions for the unit trust and other funds managed by the Managers.




HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Premium Property Equity Fund

106

HSBC Insurance Premium Property Equity Fund

Fund Objective

HSBC Insurance Premium Property Equity Fund seeks to achieve long-term capital appreciation by investing in the quoted equity securities of companies or Real Estate Investment Trusts (or its equivalents) listed or traded on a regulated market which derives the main part of their revenue from the ownership, management and/or development of real estate, throughout the world. The Fund invests all or substantially all of its assets primarily 50% into the Henderson Horizon Fund - Global Property Equities Fund, 25% into the Henderson Horizon Fund - Pan European Property Equities Fund and 25% into the Henderson Horizon Fund - Asia-Pacific Property Equities Fund.

Global Property Equities Fund, Asia-Pacific Property Equities Fund & Pan European Property Equities Fund


FUND FACTS Underlying Sub- Funds

25%: Henderson Horizon Fund - Pan European Property Equities Fund 50%: Henderson Horizon Fund - Global Property Equities Fund 25%: Henderson Horizon Fund - Asia-Pacific Property Equities Fund

Fund Manager Henderson Global Investors (Singapore) Limited

Launch Date 01 Nov 2007 CPFIS/SRS SRS CPFIS Risk Classification

N.A.


Global markets took a tumble after the unexpected results of the UK referendum on the future of its EU membership. Most investors were not positioned for the “Brexit” result and this was reflected in one of history’s most dramatic declines in the sterling pound as well as global equity markets. There have been no signs of financial distress and central bank liquidity swap lines have not been activated so far. Brexit may just be the perfect excuse for central banks around the world to extend further monetary easing and for governments to seriously consider fiscal easing. This will provide some relief to Asian markets which had come under pressure by prospects of US interest rate tightening. The impact of Brexit on Asia may be more financial flow than trade-related. Any potential weakness could be offset by additional monetary and fiscal easing. Indonesia, India and Korea have been leading the way on interest rate cuts and Korea recently announced a fiscal budget boost.


The highly regarded RBI governor Raghuram Rajan made a surprise announcement that he would not seek an extension of his three-year term, which ends in September. The fear now is that India will no longer continue with the cleaning up of the banking system. In the short-term, markets will likely be supported by easier monetary policy while it awaits news on Rajan’s replacement.

South Korea is the latest country to join the monetary easing bandwagon. The economy is struggling with an ongoing corporate restructuring in the beleaguered shipbuilding and shipping industries which could lead to massive layoffs. There is growing pressure on the central bank to announce QE, specifically to purchase Korea Development Bank bonds and mortgage-back securities. If this were to happen, it would be the first emerging market to engage in QE.

While the impact of Brexit on Asian equities is unlikely to extend much beyond the initial shock, and while it isn't a replay of 2008, Brexit nevertheless serves to refocus investors' attention on the plethora of unresolved macro-economic challenges that have hobbled financial investments and risk taking in general for so many years now. The prospect for the US rate cycle turning benign and of renewed monetary easing across most parts of the world is helpful, thanks to Brexit. Earnings revision in Asia appears to have troughed for now, in part helped by a USD no longer rising unabatedly, and commodity prices that are rebounding.

^ Source: Henderson Global Investors (Singapore) Limited


107


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Premium Property Equity Fund (0.35) (2.55) 5.03 24.05 40.09 N.A. (6.46)

Benchmark* 1.32 0.58 6.04 30.73 52.31 N.A. 13.21


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Premium Property Equity Fund 7.45 6.98 N.A. (0.77) Benchmark* 9.34 8.78 N.A. 1.45

*50% FTSE EPRA/NAREIT Developed Index + 25% FTSE EPRA/NAREIT Pure Asia total return netdividend Index (Capital constrained) + 25% FTSE EPRA/NAREIT Developed Europe Capped Index TRI ^Inception Date: 15 Nov 2007


Henderson Horizon Equities Fund 100.71 1.42Other liabilities (0.71) (0.01)

Total 100.00 1.41



C) Underlying Sub-Fund Disclosure I Henderson Horizon Fund - Asia-Pacific Property Equities Fund Allocation By Country As at 30 Jun 2016 Country % of NAV MV S$ mil

Japan 42.42 169.72Hong Kong 27.26 109.05Australia 20.45 81.84Singapore 8.26 33.05Cash 1.61 6.44

Total 100.00 400.10

II Henderson Horizon Fund - Asia-Pacific Property Equities Fund Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil

Financials 98.39 393.66Cash 1.61 6.44

Total 100.00 400.10


108

III Henderson Horizon Fund - Global Property Equities Fund Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

United States 58.33 360.54Japan 10.94 67.64Hong Kong 7.29 45.08United Kingdom 5.24 32.39Australia 5.09 31.47Germany 3.14 19.40Netherlands 2.98 18.45Singapore 1.60 9.92Others* 4.49 27.69Cash 0.90 5.54


IV Henderson Horizon Fund - Global Property Equities Fund Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil

Real Estate Investment Trusts 81.83 505.83Real Estate Investment & Services 16.20 100.16Travel & Leisure 1.07 6.59Cash 0.90 5.54

Total 100.00 618.12

V Henderson Horizon Fund - Pan European Property Equities Fund Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

United Kingdom 34.03 229.63 Germany 22.53 151.97 Netherlands 12.67 85.46 France 11.95 80.57 Sweden 7.70 51.91 Spain 6.73 45.38 Switzerland 1.97 13.32 Ireland 1.94 13.07 Italy 0.53 3.55 Cash (0.05) (0.36)

Total 100.00 674.50

VI Henderson Horizon Fund - Pan European Property Equities Fund Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil

Financials 99.19 669.09 Consumer Discretionary 0.70 4.72 Industrials 0.16 1.05 Cash (0.05) (0.36)

Total 100.00 674.50

VII Allocation of Debt Securities by Credit Ratings As at 30 Jun 2016Henderson Horizon Fund - Asia-Pacific Property Equities Fund . N.A.Henderson Horizon Fund - Global Property Equities Fund N.A.

Henderson Horizon Fund - Pan European Property Equities Fund N.A.


109

VIII Top Ten Holdings of Underlying Sub-Fund As at 30 Jun 2016 Henderson Horizon Fund - Asia-Pacific Property Equities Fund % of NAV MV S$ mil

Scentre Group 9.52 38.03Mitsui Fudosan 8.28 33.11Sun Hung Kai Properties 7.59 30.35Link REIT 7.37 29.47Cheung Kong Property 6.28 25.13Goodman Group 4.63 18.54Orix JREIT 4.53 18.13Nippon Building Fund 4.40 17.62Japan Real Estate Investment 4.36 17.46GLP J-Reit 4.14 16.58

Top Ten Holdings of Underlying Sub-Fund As at 30 Jun 2015 Henderson Horizon Fund - Asia-Pacific Property Equities Fund % of NAV MV S$ mil

Sun Hung Kai Properties 8.95 37.82Mitsui Fudosan 8.72 36.87Mitsubishi Estate 8.40 35.49Scentre Group 8.36 35.34Mirvac Group 4.62 19.51Hongkong Land 4.57 19.32Cheung Kong Property 4.54 19.20Japan Real Estate Investment 4.49 18.99Goodman Group 4.45 18.83CapitaLand Mall Trust 4.43 18.73

IX Top Ten Holdings of Underlying Sub-Fund As at 30 Jun 2016 Henderson Horizon Fund - Global Property Equities Fund % of NAV MV S$ mil

Simon Property Group 5.84 36.12AvalonBay Communities 4.35 26.87Mitsui Fudosan 3.89 24.04Prologis 3.81 23.52General Growth Properties 3.68 22.75Hudson Pacific Properties 3.12 19.28Rexford Industrial Realty 3.09 19.09Physicians Realty Trust 2.82 17.42Equity One 2.75 17.01STORE Capital 2.65 16.38

Top Ten Holdings of Underlying Sub-Fund As at 30 Jun 2015 Henderson Horizon Fund - Global Property Equities Fund % of NAV MV S$ mil

Simon Property Group 7.55 58.30Mitsui Fudosan 4.99 38.52Sun Hung Kai Properties 3.42 26.41British Land 3.33 25.71Boston Properties 3.21 24.83Ventas 3.19 24.68Cheung Kong Property 3.04 23.48Essex Property Trust 2.83 21.88UDR 2.62 20.24SL Green Realty 2.61 20.20


110

X Top Ten Holdings of Underlying Sub-Fund As at 30 Jun 2016 Henderson Horizon Fund - Pan European Property Equities Fund % of NAV MV S$ mil

Deutsche Wohnen 9.64 65.01Unibail-Rodamco 8.50 57.30Land Securities Group 7.34 49.54Vonovia 6.12 41.27British Land 5.94 40.08Klepierre 4.60 31.01Hemfosa Fastigheter 4.33 29.23Eurocommercial Properties 4.17 28.16Safestore 3.79 25.57Inmobiliaria Colonial 3.56 23.98

Top Ten Holdings of Underlying Sub-Fund As at 30 Jun 2015 Henderson Horizon Fund - Pan European Property Equities Fund % of NAV MV S$ mil

Land Securities Group 9.80 61.96British Land 9.42 59.57Unibail-Rodamco 6.88 43.54Great Portland Estates 5.47 34.61Eurocommercial Properties 5.05 31.92Deutsche Wohnen 4.72 29.85Klepierre 4.63 29.31ICADE 4.60 29.12Safestore 4.56 28.83Derwent London 3.80 24.06

XI Exposure to Derivatives As at 30 Jun 2016 Henderson Horizon Fund - Asia-Pacific Property Equities Fund N.A. Henderson Horizon Fund - Global Property Equities Fund N.A. Henderson Horizon Fund - Pan European Property Equities Fund N.A.

XII Borrowings of Net Asset Value As at 30 Jun 2016Henderson Horizon Fund - Asia-Pacific Property Equities Fund N.A.Henderson Horizon Fund - Global Property Equities Fund N.A.Henderson Horizon Fund - Pan European Property Equities Fund N.A.


As at 31-Dec-15* As at 30-Jun-15 As at 30-Jun-16 As at 30-Jun-15 Underlying Sub-Fund Level

Henderson Horizon Fund - Asia-Pacific Property Equities Fund 0.48% 1.84% 96.88%** 106.83%** Henderson Horizon Fund - Global Property Equities Fund 0.96% 1.83% 110.60%** 163.84%** Henderson Horizon Fund - Pan European Property Equities Fund 0.48% 1.84% (60.37%**) (59.15%)**

As at 30-Jun-16 ILP Sub-Fund Level

HSBC Insurance Premium Property Equity Fund 2.21% 2.16% 12.36% 14.16% *Based on the unaudited figures as at 31 Dec 2015 as the expense ratio of Henderson Horizon Fund - Asia-Pacific Property Equities Fund , Henderson Horizon Fund - Global Property Equities Fund and Henderson Horizon Fund - Pan European Property Equities Fund for the financial year ended 30 Jun 2016 are not available. **Turnover Ratio calculation is based on Luxembourg GAAP.

II Related-Party Transactions Cash balances maintained with HSBC Bank as at 30 June 2016 amounts to S$2,007.



111

IV Soft Dollar Commission Arrangement The Investment Manager is authorised to effect transactions through brokers whereby the broker agrees to use a proportion of the commission earned on such transactions to discharge the broker's own costs or the costs of third parties in providing certain services to the Investment Manager. The services which can be paid for under such arrangements are those permitted under the rules of the Financial Conduct Authority ("FCA") namely those that relate to the execution of transactions on behalf of customers or the provision of investment research to the Investment Manager.




HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance SGD Reserve Fund

112

HSBC Insurance SGD Reserve Fund

Fund Objective

HSBC Insurance SGD Reserve Fund seeks to achieve a return in line with the one month Singapore Dollar Interbank Bid Rate (SIBID) whilst managing liquidity and risk to preserve capital. Fund investments are made by way of a feeder fund, which invests substantially all, or all its assets in the Schroder S$ Reserve Fund.


In the 2H15, government bond market movements

FUND FACTS Underlying Fund Schroder S$ Reserve Fund Fund Manager Schroder Investment

Management (Singapore) Ltd Launch Date 14 Oct 2005 CPFIS/SRS SRS CPFIS Risk Classification

N.A.


broadly reflected the diverging policy trajectories of the world’s major central banks. Mounting expectations of a rate rise from the FED were fulfilled in December after the FED surprised the markets by not easing in September - with the 25BPS rate rise the first in almost a decade. In the eurozone, the ECB delivered on its promise to extend policy accommodation, but the measures ultimately fell short of market hopes. Late October saw another interest rate cut by the PBoC, the sixth such cut in a year as the Chinese authorities continued to ease following weaker than expected growth data. PBoc also surprised financial markets back in August to devalue the RMB currency markedly.

Coming into 2016 risk across most asset classes was shunned at the start of the year before an abrupt reversal of sentiment took hold around the mid-point of the first quarter. The oil price declined sharply early in the year but rebounded to end the first quarter at US$39; the recovery coinciding with a sharp improvement in market mood. Key economic data points also improved and support from major global central banks continued.

Much of the momentum from the March’s recovery carried into April and May. However, the UK’s EU referendum in late June ultimately overshadowed other market drivers by the end of Q2. The “Leave” vote from the UK took many investors by surprise; the number of positions built in anticipation of a “Remain” vote exacerbating market volatility in the days immediately after the result. Sterling fell by over 11% on 24 June, while government bond yields were sharply lower.

Against this backdrop, Singapore government bond yields declined in tandem with US Treasury yields, from 2.7% (as of 30th June 2015) to 1.9% (as of 30th June 2016). The 1-month and 3-month SIBOR rose sharply in January amidst concerns over China’s economic slowdown and falling oil prices but ended the period at 0.7% and 0.9% respectively.


Looking ahead, as we enter the 2H16, geopolitical tensions, slow productivity in the developed world, Brexit, weak demographics and challenging liquidity are very much in the forefront. Against this backdrop we have revised our view towards a one or no increase in US rates this year. We believe that the FED is likely to remain very cautious and hence higher US Treasury yields and a stronger USD is going to remain a longer term prospect than a near term phenomena.

Although the Brexit vote to “Leave” was unexpected, the previous issues facing the Singapore economy remain and continue to pose the biggest obstacles. Namely, any lack of a significant pickup in global trade, as well as global growth, along with the usual China worries. We believe the local economy is still weak and this will put further pressure on the Monetary Authority of Singapore (MAS) to maintain a flattish bias to their currency policy. However, given that yields are attractive in the AAA space, and the global outlook is more uncertain following the British exit from Europe, Singapore government bonds should benefit.



113


3-Mth (%)

6-Mth (%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

Since Inception ̂

(%) HSBC Insurance SGD Reserve Fund 0.08 0.07 0.32 0.28 0.33 8.75 11.27 Benchmark* 0.17 0.44 0.86 1.53 1.81 6.90 9.03 II Average Annual Compounded Returns

3-Year(%)

5-Year(%)

10-Year(%)

Since Inception ̂

(%) HSBC Insurance SGD Reserve Fund 0.09 0.07 0.84 1.00 Benchmark* 0.51 0.36 0.67 0.81

*1 Month Singapore Dollar Interbank Bid Rate (SIBID) ^Inception Date: 28 Oct 2005


Schroder S$ Reserve Fund 100.00 8.17 Total 100.00 8.17



C) Underlying Fund Disclosure (Schroder S$ Reserve Fund) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil

Singapore 124.65 24.78Other net assets/(liabilities) (24.65) (4.90)

Total 100.00 19.88

II Allocation by Industry As at 30 Jun 2016N.A


Unrated 124.65 24.78 Total 124.65 24.78

IV Top Ten Holdings of Underlying Fund^ As at 30 Jun 2016% of NAV MV S$ mil

MAS Bill Series 84 22 July 2016 31.20 6.20MAS Bill Series 84 1 July 2016 25.15 5.00MAS Bill Series 84 23 Sep 2016 25.10 4.99MAS Bill Series 84 19 Aug 2016 22.13 4.40MAS Bill Series 84 16 Sep 2016 21.08 4.19


114

Top Ten Holdings of Underlying Fund^ As at 30 Jun 2015% of NAV MV S$ mil

MAS Bill Series 84 21 Aug 2015 22.09 6.48MAS Bill Series 84 31 Jul 2015 18.41 5.40MAS Bill Series 84 18 Sep 2015 10.88 3.19MAS Bill Series 87 20 Jul 2015 8.52 2.50Bank of China Ltd / Singapore FXCD 1.1% 6 Aug 2015 6.82 2.00MAS Bill Series 84 4 Sep 2015 6.82 2.00MAS Bill Series 84 11 Sep 2015 6.82 2.00^ Less than Ten Holdings in the Underlying Fund



D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance SGD Reserve




*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Schroder S$ Reserve Fund forthe financial year ended 30 Jun 2016 is not available.


The Manager of the Fund is Schroder Investment Management (Singapore) Ltd. The Registrar for the Fund is Schroder Investment Management (Luxembourg) S.A., a related party of the Manager. The Trustee is HSBC Institutional Trust Services (Singapore) Limited, a subsidiary of the HSBC Group. The management fees paid to the Manager and registration fees paid to the Registrar; trustee fees, valuation fees and custodian fees charged by the HSBC Group are shown in the Statement of Total Return of the financial statements for the financial period ended. 30 June 2016


IV Soft Dollar Commission Arrangement In the management of the Fund, the Manager may accept soft dollar commissions from, or enter into softdollar arrangements with, stockbrokers who execute trades on behalf of the Fund and the soft dollarsreceived are restricted to the following kinds of services:


The Manager may not receive or enter into soft dollar commissions or arrangements unless (a) such softdollar commissions or arrangements shall reasonably assist the Manager in their management of theFund, (b) best execution is carried out for the transactions, and (c) that no unnecessary trades areentered into in order to qualify for such soft dollar commissions or arrangements. The Manager shall notreceive goods and services such as travel, accommodation and entertainment.


115




HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Singapore Balanced Fund

116

HSBC Insurance Singapore Balanced Fund

Fund Objective

HSBC Insurance Singapore Balanced Fund seeks to achieve capital appreciation in the long-term by investing 70% of its assets into a diversified portfolio of Singapore equity and equity-related securities and 30% of its remaining assets into quality investment grade bonds of Singapore and major bond markets. The Fund invests substantially all or all its assets primarily 70% into the Deutsche Singapore Equity Fund and 30% into the Deutsche Lion Bond Fund.

Deutsche Premier Investment Funds – Deutsche Singapore Equity Fund


For the period under review, the Singapore equity

FUND FACTS Underlying Sub-Funds 70%: Deutsche Premier

Investment Funds - Deutsche Singapore Equity Fund30%: Deutsche Lion Bond Fund

Fund Manager Deutsche Asset Management (Asia) Limited

Launch Date 26 May 2008 CPFIS/SRS SRS CPFIS Risk Classification

N.A.


market ended flat. Market was volatile as investors looked to major macro-economic events for direction. Buying sentiment was generally curtailed by concerns over a China slowdown, uncertainty in the timing of the US interest rate lift-off and the Brexit referendum. On the domestic front, local GDP growth outlook and corporate earnings continued to see downgrades on the back of a challenging global economic environment.

Against this backdrop, defensives such as Real Estate Investment Trust (REITs) and Singapore Telecommunications dominated the list of outperformers. Commodity-related names like Noble Group, Keppel Corp and Sembcorp Marine underperformed on expectations of further asset write-downs and provisions.

The Fund performed in line with the benchmark for the period under review. Key contributors were Jardine Matheson and Jardine Cycle and Carriage which were seen as beneficiaries of the recovery in consumer sentiment in the Indonesian economy.


The Brexit event is likely to delay the onset of a meaningful rate hike trajectory in the US. It has negative bearing on the still fragile global economic growth and expectations are building for more monetary easing from ECB, BoE and BoJ. This would bode well for quality, high yielding stocks in which the portfolio is selectively positioned in. Barring a Brexit contagion scenario, we see support for the Singapore equity market with current valuations close to the lows seen during the last Eurozone crisis.

Deutsche Lion Bond Fund

*Please refer to HSBC Insurance Singapore Bond Fund on page 120 for the Investment and Market Review and the Market Outlook and Investment Strategy.



3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance Singapore Balanced Fund 0.60 0.39 (7.10) (1.86) 3.94 N.A. 16.89

Benchmark* 0.30 0.18 (7.78) 0.57 4.79 N.A. 17.73


117


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Singapore Balanced Fund (0.62) 0.78 N.A. 1.95 Benchmark* 0.19 0.94 N.A. 2.04

*70% MSCI Singapore Total Return Index, with Gross Dividends reinvested and 30% 6-month Singapore Inter-bank Offer Rate (SIBOR) minus 12.5 basis points ^Inception Date: 02 Jun 2008


Asset Class % of NAV MV S$ mil Deutsche Premier Investment Funds – Deutsche Singapore Equity Fund 68.91 11.79 Deutsche Lion Bond Fund 31.09 5.32

Total 100.00 17.11


Subscription 3,927,176 Redemption 970,150

C) Underlying Fund Disclosure (Deutsche Premier Investments Fund – Deutsche Singapore Equity Fund)

I Allocation by Country As at 30 Jun 2016Country % of NAV MV S$ mil

Singapore 95.23 59.20 Bermuda 1.32 0.82 Isle of Man 0.97 0.60 Other net assets 2.48 1.54

Total 100.00 62.16


Banks 28.68 17.83 Telecom Service 13.71 8.52 Real Estate 10.84 6.74 Transport 9.17 5.70 Real Estate Investment Trust 6.35 3.95 Diversified Resources 4.83 3.00 Wholesale 4.17 2.59 Finance 3.99 2.48 Engineering/Machine 3.83 2.38

Agriculture 3.57 2.22 Healthcare 2.51 1.56 Others* 8.35 5.19

Total 100.00 62.16 *Includes other industries and other net assets



118


DBS Group Holdings Limited 13.25 8.24 Singapore Telecommunications Limited 12.61 7.84 Oversea-Chinese Banking Corporation Limited 8.99 5.59 United Overseas Bank Limited 6.44 4.00 Keppel Corporation Limited 4.83 3.00 ComfortDelGro Corporation Limited 4.76 2.96 Jardine Cycle & Carriage Limited 4.17 2.59 UOL Group Limited 4.01 2.49 Singapore Exchange Limited 3.99 2.48 Capitaland Limited 3.81 2.37


Singapore Telecommunications Limited 13.38 9.22 DBS Group Holdings Limited 12.82 8.83 United Overseas Bank Limited 9.99 6.88 Oversea-Chinese Banking Corporation Limited 9.58 6.60 Capitaland Limited 5.31 3.66 Keppel Corporation Limited 4.88 3.36 ComfortDelGro Corporation Limited 4.25 2.93 Global Logistic Properties Limited 3.88 2.67 Singapore Exchange Limited 3.19 2.20 UOL Group Limited 2.95 2.03

V Exposure to Derivatives As at 30 Jun 2016 % of NAV - Market value (S$) - Realised Gains / Losses (S$) 2,166 Unrealised Gains / Losses (S$) -


*HBSC Insurance Singapore Balanced Fund invests 30% into Deutsche Lion Bond Fund. Please refer toHSBC Insurance Singapore Bond Fund on page 121for the underlying fund disclosure on Deutsche LionBond fund under Section C.


As at 31-Mar-16* As at 30-Jun-15 As at 30-Jun-16 As at 30-Jun-15 Underlying Sub-Fund Level Deutsche Singapore Equity Fund 1.72% 1.71% 50.29% 47.30%

Deutsche Lion Bond Fund 0.69% 0.68% 38.31% 33.86% As at 30-Jun-16

ILP Sub-Fund Level HSBC Insurance Singapore Balanced Fund 1.65% 1.65% 7.04% 9.37% *Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Deutsche Singapore Equity Fund and Deutsche Lion Bond Fund for the financial year ended 30 Jun 2016 is not available.




119

IV Soft Dollar Commission AgreementSoft dollar commissions are benefits accorded to Manager by their brokers, usually in the form of research, advisory, analysis and data services, computer hardware or software used for and/or in support of the investment process.

The Manager’s policy on soft dollar commissions is as follows: - The goods and services received would assist in the provision of investment services and advices or related services to the unit trust; - Transactions are executed on the best available terms; and - The Manager does not engage in unnecessary trades in order to qualify for soft dollar commissions.


E) Financial Statements Refer to Page 153.

For more information, please contact your financial planner, call our Customer Service Hotline on 6225 6111,


HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Singapore Bond Fund

120

HSBC Insurance Singapore Bond Fund

Fund Objective

HSBC Insurance Singapore Bond Fund seeks to achieve attractive returns by investing in Single A and above quality investment grade bonds of Singapore and major bond markets such as the G7 countries, Australia, New Zealand, Hong Kong and South Korea. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the Deutsche Lion Bond Fund.


FUND FACTS Underlying Fund Deutsche Lion Bond Fund Fund Manager Deutsche Asset

Management (Asia) Limited Launch Date 02 May 2002 CPFIS/SRS OA/SA/SRS CPFIS Risk Classification

Low to Medium Risk - Broadly Diversified


The review period was eventful as the The Federal Open Market Committee hiked benchmark rates above zero in Dec 2015. However, market expectations of a sustained rate rise cycle were quickly extinguished as US jobs creation stalled China’s growth rate fell and the UK voted to exit the EU.

The S&P Index was generally strong except for occasional blips over the timing of first rate hike and the pace of subsequent hikes. The 10-year USTs yield started out high, averaging 2.2% over 2H15 but rapidly fell as economic and political risks piled up, ending at 1.47% just above its historical low. Strong jobs creation of +280k jobs per month in 4Q15 was the main justification for the initial rate hike but the 2Q16 collapse to +140k on average removed the possibility of subsequent hikes.

Asia’s main economies were adversely affected by the rate hike and a slowing China. Externally-orientated Singapore economy was not spared as inflation and growth stagnated at cycle lows. Brake on global trade and ongoing economic restructuring dragged on manufacturing. In services, finance grew throughout 2015 but struggled thereafter. Financial Year 2016 growth outlook will be at the low end of 1-3% forecast with 2Q16 growth at +2.2% year-on-year.


The Fund’s performance up to Dec 2015 was indifferent as fixed income markets sold off on rate hike concerns. However, doubts about the likelihood of a rapid rate hike cycle led us to increase duration thereafter, which contributed positively. The current risk-off sentiment leaves the Fund well-invested in strong credits but with increasing caution due to expensive valuations.



3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Singapore Bond Fund 0.73 1.95 2.11 5.55 9.17 28.78 37.97 Benchmark* 0.28 0.54 0.97 1.75 2.45 10.72 16.59


3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Singapore Bond Fund 1.82 1.77 2.56 2.31 Benchmark* 0.58 0.48 1.02 1.10

*6-month Singapore Inter-bank Offer Rate (SIBOR) minus 12.5 basis points ^Inception Date: 04 Jun 2002


121

B) Fund DisclosureI Allocation by Asset Class As at 30 Jun 2016

Asset Class % of NAV MV S$ milDeutsche Lion Bond Fund 100.00 32.21Total 100.00 32.21



C) Underlying Fund Disclosure (Deutsche Lion Bond Fund) I Allocation by Country As at 30 Jun 2016

Country % of NAV MV S$ mil Singapore 49.62 105.26 Malaysia 12.10 25.67 Cayman Islands 10.53 22.33 China 5.25 11.13 Japan 4.98 10.57 South Korea 4.90 10.39 British Virgin Islands 2.43 5.15 Indonesia 1.27 2.69 Netherlands 1.18 2.51 Others* 7.74 16.42

Total 100.00 212.12*Includes other countries and net assets


Banks 30.78 65.29 Real Estate 21.75 46.14 Finance 11.04 23.41 Transport 4.55 9.66 Internet Service 4.54 9.62 Education 3.55 7.54

Real Estate Investment Trust 2.86 6.06 City Gas 2.80 5.94 Telecommunications 2.15 4.55 Government 2.04 4.32 Investment 1.47 3.11 Others* 12.47 26.48

Total 100.00 212.12*Includes other industries and net assets

III Allocation of Debt Securities by Credit Ratings As at 30 Jun 2016Rating % of NAV MV S$ milAaa 3.56 7.54 AA (by S&P) 2.51 5.33 Aa2 3.89 8.26 AA- (by S&P) 1.27 2.69 Aa3 14.58 30.93 A+ (by S&P) 4.57 9.70 A1 11.70 24.82 A (by S&P) 0.94 1.99 A2 8.40 17.81 A- (by S&P) 1.75 3.72 A3 18.46 39.15 Unrated 22.71 48.17 Accrued interest receivable on quoted bonds 0.76 1.61 Other net assets 4.90 10.40 Total 100.00 212.12


122


United Overseas Bank Limited Series EMTN Var 11/07/2022 5.57 11.85DBS Bank Limited Singapore Series MTN Var 21/02/2022 4.50 9.54UOL Treasury Services Series MTN 2.5% 20/04/2018 3.64 7.73Sun Hung Kai Properties Capital Market Limited MTN 3.25% 20/05/2021 3.59 7.61Singapore Bus Services MTN 1.8% 12/09/2017 3.29 6.97Bank of Communications HK EMTN 2.1% 24/07/2017 3.18 6.75Singapore Management University MTN 3.155% 07/03/2024 2.96 6.27FCL Treasury Pte Limited 3.7% 05/04/2019 2.88 6.10CCT MTN Pte Limited Series EMTN 2.96% 13/08/2021 2.86 6.06Petronas Capital Limited 5.25% 12/08/2019 2.80 5.94


United Overseas Bank Limited Series EMTN Var 11/07/2022 5.46 11.90HK Land Treasury SG 3.65% 05/10/2015 5.31 11.56DBS Bank Limited Singapore Series MTN 21/02/2022 4.42 9.63ANZ National International Limited Series EMTN 2.95% 27/07/2015 4.14 9.01Sun Hung Kai Properties Capital Market Limited MTN 3.25% 20/05/2021 3.47 7.57Morgan Stanley EMTN 3.8% 29/01/2016 3.25 7.07Danga Capital Berhad 2.615% 11/08/2015 3.21 7.00Singapore Bus Services MTN 1.8% 12/09/2017 3.19 6.95Silver Oak Limited FRN 21/06/2016 3.11 6.77Bank of Communications HK EMTN 2.1% 24/07/2017 3.09 6.73

V Exposure to Derivatives As at 30 Jun 2016% of NAV 0.22% Market value (S$) 476,056 Realised Gains / (Losses) (S$) 1,724,965 Unrealised Gains / (Losses) (S$) 476,056


D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Singapore Bond



As at 30-Jun-16Turnover Ratio 6.42% 5.31% 38.31% 33.86% *Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Deutsche Lion Bond Fund for the financial year ended 30 Jun 2016 is not available.




123

IV Soft Dollar Commission Agreement Soft dollar commissions are benefits accorded to Manager by their brokers, usually in the form of research, advisory, analysis and data services, computer hardware or software used for and/or in support of the investment process.

The Manager’s policy on soft dollar commissions is as follows: - The goods and services received would assist in the provision of investment services and advices or related services to the unit trust; - Transactions are executed on the best available terms; and - The Manager does not engage in unnecessary trades in order to qualify for soft dollar commissions.



For more information, please contact your financial planner, call our Customer Service Hotline on 6225 6111, or visit our web site at www.insurance.hsbc.com.sg.

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance Singapore Equity Fund

124

HSBC Insurance Singapore Equity Fund

Fund Objective

HSBC Insurance Singapore Equity Fund seeks to achieve long-term capital growth primarily through investment in securities of companies listed on the Singapore Exchange Securities Trading Limited. The portfolio will be broadly diversified with no specific industry or sectoral emphasis. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the Schroder Singapore Trust.


FUND FACTS Underlying Fund Schroder Singapore Trust Fund Manager Schroder Investment

Management (Singapore) Ltd Launch Date 03 August 2015 CPFIS/SRS SRS CPFIS Risk Classification

N.A.


Stocks registered double-digit losses over the one-year period to June 2016. Defensive sectors and companies with stable earnings held up better, while more cyclical sectors such as Capital Goods and Banks were under pressure. Capital Goods in particular were subject to negative newsflow on rig orders, sliding oil prices and balance sheet stress of key customers. Banks languished on concerns over non-performing loan trends and higher credit costs.Telcos and REITs performed better on rising risk aversion and demand for yield in a global milieu of near-zero to negative policy interest rates.

The Fund fell 9.6% over the one-year period, outperforming the Benchmark which fell by 11.6%. Outperformance came from the Underweight in Capital Goods while positive stock selection within Transport similarly contributed. Within the Transportation sector, the overweight in SATS and underweight in Hutchison Port Holdings Trust helped. Underweight positions in Banks similarly contributed as banks suffered on concerns over provisions as the economy weakened.


Looking ahead, as we enter the second half of 2016, geopolitical tensions, slow productivity in the developed world, Brexit, weak demographics and challenging liquidity are very much in the forefront. Against this backdrop we have revised our view towards a one or no increase in US rates this year. We believe that the US Federal Reserve is likely to remain very cautious and hence higher US Treasury yields and a stronger US Dollar is going to remain a longer term prospect than a near term phenomena.

Although the Brexit vote to “Leave” was unexpected, the previous issues facing the Singapore economy remain and continue to pose the biggest obstacles. Namely, any lack of a significant pickup in global trade, as well as global growth, along with the usual China worries. We believe the local economy is still weak and this will put further pressure on the MAS to maintain a flattish bias to their currency policy. However, given that yields are attractive in the AAA space, and the global outlook is more uncertain following the British exit from Europe, Singapore government bonds should benefit.



3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance Singapore Equity Fund 1.69 (0.19) N.A. N.A. N.A. N.A. (1.82) Benchmark* 0.29 0.00 N.A. N.A. N.A. N.A. (5.87)

*MSCI Singapore Free Index ^Inception Date: 17 Aug 2015


125


Asset Class % of NAV MV S$ mil Schroder Singapore Trust 100.00 0.69

Total 100.00 0.69

II Fund Movement (03 Aug 2015 - 30 Jun 2016)S$


C) Underlying Fund Disclosure (Schroder Singapore Trust) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil Singapore 94.36 639.26 Other net assets/(liabilities) 5.64 38.21

Total 100.00 677.47

II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil Finance 32.43 219.73 Real Estate 19.85 134.47 Telecommunications 18.15 122.94 Industrial And Transportation 11.32 76.66 Diversified Operations 5.44 36.86 Consumer 2.51 17.00 Health Care 1.92 13.03

Agriculture 1.46 9.92 Collective investment schemes - Equities 1.28 8.65 Other net assets/(liabilities) 5.64 38.21

Total 100.00 677.47



Singapore Telecommunications Ltd 15.74 106.63 DBS Group Hldg Ltd 11.48 77.80 Oversea-Chinese Banking Corp Ltd 9.84 66.68 United Overseas Bank Ltd 8.76 59.36 CapitaLand Ltd 6.05 41.02 ComfortDelGro Corp Ltd 4.74 32.08 Keppel Corp Ltd 4.00 27.07 Mapletree Industrial Trust 3.65 24.73 UOL Group Ltd 3.10 20.98 Venture Corp Ltd 2.63 17.81




126

D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance Singapore Equity



As at 30-Jun-16 Turnover Ratio 0.89% 13.76% *Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Schroder Singapore Trust for the financial year ended 30 Jun 2016 is not available.



IV Soft Dollar Commission Agreement In the management of the Fund, the Manager may accept soft dollar commissions from, or enter into soft dollar arrangements with, stockbrokers who execute trades on behalf of the Fund and the soft dollars received are restricted to the following kinds of services:


The Manager may not receive or enter into soft dollar commissions or arrangements unless (a) such soft dollar commissions or arrangements shall reasonably assist the Manager in their management of the Fund, (b) best execution is carried out for the transactions, and (c) that no unnecessary trades are entered into in order to qualify for such soft dollar commissions or arrangements.The Manager shall not receive goods and services such as travel, accommodation and entertainment.




HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance US Equity Index Fund

127

HSBC Insurance US Equity Index Fund

Fund Objective

The Fund aims to track the HSBC Economic Scale Index United States (the “US Index”) by investing in securities that are included in the US Index. The Optimised Replication strategy involves the acquisition of a subset of the component securities of the US Index and possibly of some securities that are not included in the US Index that are designed to help the Fund track the performance of the US Index. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the HSBC Global Investment Funds – Economic Scale Index US Equity Fund.


Funds – Economic Scale Index US Equity Fund.



N.A.



The FED finally raised interest rates in December 2015, ending an extraordinary period of government intervention in the financial markets that started at the height of the recession. The global markets eased slightly after the FED’s rate hike, emerging markets were largely disappointing in 2015. Equities reacted favourably to the FED’s decision to hike interest rates for the first time since 2006, signalling faith in the strength of the US recovery. The price of oil fell to its lowest level in 11 years to around $36 per barrel in December 2015 as commodity markets responded to signs that the global slump may deepen in 2016.

In 2016 markets were supported by a rally in the energy sector, as oil prices firmed during the second quarter. The FED shifted to a more dovish tone in June on the back of a disappointing May payrolls print and uncertainty ahead of the UK referendum vote. Later in the period, the decreasing likelihood of further interest-rate rises also provided a boost to equities.


Over the year the fund returned 0.04% underperforming the S&P 500 Net by (0.27%) to the end of June 2016. On the sector front, the relative underperformance was driven by stock selection (4.04%) while sector allocation was positive and contributing 0.76% over the year.

Stock selection in Martials was positive led by off benchmark allocation to US Steel Corp and over weight to Freepost McMoran. Over the year the largest detractors to performance were led by underweights to Amazon, Facebook and Alphabet Inc. The Contributors to performance was led by underweight to Apple, Gilead Sciences and Biogen Inc.

In terms of sector allocation the underweight to Health Care was positive contributor to relative performance while underweight to Utilities detracted.



3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%) HSBC Insurance US Equity Index Fund 0.42 N.A. N.A. N.A. N.A. N.A. 10.77 Benchmark* 1.77 N.A. N.A. N.A. N.A. N.A. 7.99

*HSBC Economic Scale Index United States ^Inception Date: 28 Jan 2016


128


Asset Class % of NAV MV S$ milHSBC Global Investment Funds - Economic Scale Index US Equity Fund 100.00 0.21Total 100.00 0.21



C)Underlying Sub-Fund Disclosure (HSBC Global Investment Funds - Economic Scale Index US Equity Fund)

I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil US 99.24 942.97 Cash 0.76 7.22

Total 100.00 950.19

II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil Consumer Discretionary 17.29 164.28 Industrials 15.31 145.47 Financials 15.30 145.38 Information Technology 13.93 132.36 Consumer Staples 11.14 105.85 Health Care 8.96 85.14 Energy 7.63 72.50 Materials 3.75 35.63 Telecommunication Services 3.70 35.16 Others* 2.23 21.20 Cash 0.76 7.22




Wal-Mart Stores Inc 3.46 32.88 General Electric Co 1.96 18.62 Exxon Mobil Corp 1.85 17.58

AT&T Inc 1.62 15.39 Verizon Communications Inc 1.31 12.45 JPmorgan Chase & Co 1.14 10.83 Wells Fargo & Co 1.09 10.36 Chevron Corp 1.09 10.36 United Parcel Service-Cl B 1.03 9.79

Apple Inc 1.00 9.50

V Exposure to Derivatives As at 30 Jun 2016 % of NAV 0.73% Market value (S$) 6,972,182 Realised Gains / (Losses) (S$) - Unrealised Gains / (Losses) (S$) (19,028)



129


Ratios HSBC Insurance US Equity Index



As at 30-Jun-16 Turnover Ratio 12.83% 0.22% *Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of HSBC Global Investment Funds - Economic Scale Index US Equity Fund for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions HSBC Insurance US Equity Index Fund S$0.21 million, equivalent to 100.00% of its net asset value in HSBC Global Investment Funds - Economic Scale Index US Equity Fund, which is managed by HSBC Global Asset Management (Singapore) Ltd.






HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance US Opportunities Equity Fund

130

HSBC Insurance US Opportunities Equity Fund

Fund Objective

HSBC Insurance US Opportunities Equity Fund aims to achieve capital appreciation by investing principally in equity securities of US companies believed to possess sustainable growth characteristics and which meet growth, quality and valuation criteria. Fund investments are made by way of a feeder fund, which invests substantially all or all its assets in the Franklin US Opportunities Fund A.

FUND FACTS Underlying Fund Franklin US Opportunities

FundFund Manager Templeton Asset

ManagementLaunch Date 18 Jan 2016 CPFIS/SRS* SRS CPFIS Risk Classification

N.A.



US stock markets continue to climb higher on encouraging US data, recovering oil prices and the FED’s cautious approach to raising interest rates. However, ongoing concerns about global growth had led to periods of significant market declines, which had sidelined investors. From our perspective, US consumers appear to be generally healthy, the economy is operating near full employment, wages are starting to rise and consumer debt levels are low. We continue to have conviction in our portfolio positioning, particularly in the IT, health care and consumer discretionary sectors, which were top-weighted sectors and relative contributors in May.

For the year ending 30 June 2016, stock selection was the primary driver of underperformance, while relative sector allocation also detracted from performance.

Health care was the largest detracting sector, due to both stock selection and our relative overweight given the sector’s weak performance for the period. More than half of our relative underperformance can be attributed to health care. Stock selection in financial and industrials also detracted, as did our underweight to the strong consumer staples sector. An overweight to biotechnology also detracted given the industry underperformed general health care after going through 2 sharp declines which we believe were primarily attributable to headline risk and political rhetoric.


Despite pullbacks in the IT and health care sectors, we continue to maintain a positive long-term growth outlook. In the technology sector, the outlook for spending remains strong, as many companies have realized that investments in technology improvements are required to remain competitive in the global marketplace. We believe the health care sector stands to benefit from an aging global population that will drive increased consumption of health care services and demand for improved treatments and cures.

We are constructive on the US equity market in 2016 and believe that periods of market volatility create opportunities for investors like ourselves who are willing to step back and take a long-term view of growth drivers and selectively choose company’s best positioned to benefit. We expect intermittent volatility as markets grapple with global growth concerns, but we continue to find opportunities tied to our long-term investment themes.



131


3-Mth(%)

6-Mth(%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

SinceInception^

(%)HSBC Insurance US Opportunities Equity Fund (0.38) N.A. N.A. N.A. N.A. N.A. 4.93


*Russell 3000 Growth Index ^Inception Date: 28 Jan 2016


Asset Class % of NAV MV S$ mil Franklin US Opportunities Fund 100.00 0.08

Total 100.00 0.08



C) Underlying Fund Disclosure (Franklin US Opportunities Fund) I Allocation by Country As at 30 Jun 2016 Country % of NAV MV S$ mil United States 95.27 4,774.48 Netherlands 2.32 116.23 Singapore 1.16 58.09 Israel 0.55 27.75 United Kingdom 0.46 22.91 Cash & Cash Equivalents 0.24 11.79

Total 100.00 5,011.25

II Allocation by Industry As at 30 Jun 2016 Industry % of NAV MV S$ mil Information Technology 37.66 1,887.81 Health Care 16.68 835.65 Consumer Discretionary 14.22 712.44 Financials 9.22 462.14 Consumer Staples 7.29 365.24 Industrials 4.06 203.56 Telecommunication Services 4.00 200.26 Materials 3.56 178.27 Energy 3.07 154.09 Cash & Cash Equivalents 0.24 11.79

Total 100.00 5,011.25



132


Alphabet Inc 4.37 219.22 Facebook Inc 4.16 208.25 Visa Inc 3.93 196.95

Allergan Plc 3.57 179.09Amazon.com Inc 3.53 176.69

Celegene Corp 3.44 172.53 Mastercard Inc 3.25 162.93 Sba Communications Corp 3.19 159.64

Apple Inc 2.60 130.28 Monster Beverage Corp 2.36 118.26




Ratios HSBC Insurance US Opportunities

Equity Fund Underlying Fund


As at 30-Jun-16 Turnover Ratio 206.84% 38.01%** *Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of Franklin US Opportunities Fund for the financial year ended 30 Jun 2016 is not available. **Turnover Ratio calculation is based on Luxembourg GAAP.



IV Soft Dollar Commission Agreement For the period 1 January 2016 to 30 June 2016, the Franklin Templeton Investment Funds – Franklin US Opportunities Fund paid US$408,823 in commission dollars generated from portfolio transactions to pay for goods or services provided by third parties under a soft dollar arrangement. All goods and services acquired with the soft dollar commission were for the benefit of the unit trust. The broker(s), who has executed trades for other funds managed by the Investment Manager, had executed the trades on best available terms and there was no churning of trades.



HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: HSBC Insurance World Selection Funds

133

HSBC Insurance World Selection Funds

Fund Facts HSBC Insurance World Selection 1 Fund

HSBC Insurance World Selection 3 Fund


Launch Date 01 Apr 2010 01 Apr 2010 01 Apr 2010 Fund Manager HSBC Global Asset Management (Singapore) Limited Underlying Sub-Fund

HSBC Portfolios – World Selection 1

HSBC Portfolios – World Selection 3

HSBC Portfolios - World Selection 5

CPFIS/SRS SRS CPFIS Risk Classification

N.A.

As at 30 Jun 2016 Offer Price S$ 1.18687 S$ 1.19258 S$ 1.17562 Bid Price S$ 1.12753 S$ 1.13295 S$ 1.11684 Fund Size S$ 0.63 mil S$ 1.58 mil S$ 4.79 mil Units in Issue 0.56 mil 1.39 mil 4.29 mil

Fund Objectives

HSBC Insurance World Selection 1 Fund seeks to provide capital growth through investment in a broad range of asset classes across global markets, consistent with a low risk investment strategy.

HSBC Insurance World Selection 3 Fund seeks to provide capital growth through investment in a broad range of asset classes across global markets, consistent with a medium risk investment strategy.

HSBC Insurance World Selection 5 Fund seeks to provide capital growth through investment in a broad range of asset classes across global markets, consistent with a high risk investment strategy.


Concerns of a global recession sparked volatility. Sentiment at the end of 2015 was weighed down by slowing economic growth in China and US monetary policy uncertainty. The FED's decision to increase interest rates in December meant monetary policy divergence in the developed world, as Europe continued to loosen policy further. While risk assets recovered at the end of the year, the start of 2016 saw global growth worries reignite. Sentiment recovered in March and remained buoyant until the UK’s decision to leave the EU on the 23rd June 2016 and disappointing jobs data in the US sparked volatility again.


The portfolio registered a positive return over the reporting period. Global equities declined in USD terms, amid risk aversion and a stronger dollar weighing on performance. High yield corporate bonds recovered as oil prices strengthened. Local currency emerging market debt was relatively flat over the period, whilst hard currency emerging market debt posted strong positive returns. Overweight exposure to global equities was reduced to neutral in July 2015, but the sell-off in risk assets in early 2016 provided a tactical opportunity, so we moved back to overweight. This position was brought back to neutral in May, taking profits. The underweight position in local currency emerging market debt was moved to neutral. The annual re-assessment of the strategic asset allocation saw the introduction of asset-backed securities into the portfolio in March. In June 'Fallen Angels', a sub-segment of global high yield bonds, was added to the portfolio.



134


3-Mth (%)

6-Mth (%)

1-Year(%)

3-Year(%)

5-Year(%)

10-Year(%)

Since Inception ̂

(%) HSBC Insurance World Selection 1 Fund* 1.52 (1.54) 2.16 16.12 26.90 N.A. 18.69

HSBC Insurance World Selection 3 Fund* 0.42 (3.48) (1.67) 15.87 26.60 N.A. 19.26

HSBC insurance World Selection 5 Fund* (1.19) (6.37) (6.25) 15.41 22.58 N.A. 17.56


3-Year(%)

5-Year(%)

10-Year(%)

Since Inception ̂

(%) HSBC Insurance World Selection 1 Fund* 5.11 4.88 N.A. 2.83 HSBC Insurance World Selection 3 Fund* 5.03 4.83 N.A. 2.87 HSBC Insurance World Selection 5 Fund* 4.89 4.16 N.A. 2.64

*These Funds do not have a benchmark due to the diverse range of asset classes; some do not have indices that meet the criteria for inclusion in a representative composite benchmark of being both investable and replicable. ^HSBC Insurance World Selection 1 Fund Inception Date: 12 May 2010 HSBC Insurance World Selection 3 Fund Inception Date: 15 Apr 2010 HSBC Insurance World Selection 5 Fund Inception Date: 20 Apr 2010



HSBC Portfolios - World Selection 1 100.00 0.63 Total 100.00 0.63


Subscription 416,023Redemption 47,697

C) Underlying Sub-Fund Disclosure (HSBC Portfolios - World Selection 1) I Allocation by Country As at 30 Jun 2016

N.A., as the fund is a fund-of-funds.

II Allocation by Industry As at 30 Jun 2016N.A., as the fund is a fund-of-funds.



135


HSBC Global Government Bond Strategy 26.08 161.34HSBC Global Corporate Bond Strategy 12.09 74.76HSBC GIF Global Government Bond 9.42 58.26HSBC GIF Global High Yield Bond 8.13 50.26Net Cash Total* 5.65 34.93HSBC GIF Global Emerging Market Local Debt 5.13 31.70HSBC GIF Global Real Estate Equity 5.00 30.93HSBC GIF Global Corporate Bond ZQ 4.91 30.39HSBC FTSE All-World Index Instl Acc 4.44 27.48HSBC ESI Worldwide Equity ETF 3.90 24.11

*sum of cash, margin and synthetic cash


Global Government Bond strategy 27.41 193.65HSBC GIF Global Government Bond ZC 18.34 129.58Global Corporate Bond strategy 12.17 86.01HSBC GIF Global High Yield Bond ZC 10.42 73.61HSBC FTSE All-World Index Instl Acc 8.16 57.67HSBC ESI Worldwide Equity ETF 4.69 33.15HSBC GIF Global Emerg Mkts Bd ZD 4.42 31.24HSBC GIF Global Em Mkts Local Dbt ZD 4.05 28.62HSBC GIF Global Corporate Bond ZC 2.51 17.75TOPIX INDX FUTR Sep15 2.48 17.49

V Exposure to Derivatives As at 30 Jun 2016% of NAV 4.65%Market value (S$) 28,790,192Realised Gains / (Losses) (S$) -Unrealised Gains / (Losses) (S$) 1,316,048


D) Other Disclosure Items I Expense/Turnover Ratios HSBC Insurance World Selection 1

Fund Underlying Sub- Fund



*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of HSBC Portfolios - World Selection 1 for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions HSBC Insurance World Selection 1 Fund S$0.63 million, equivalent to 100.00% of its net asset value in HSBC Portfolios - World Selection 1, which is managed by HSBC Global Asset Management (Singapore) Ltd.The management fees earned by HSBC Global Asset Management (Singapore) Ltd from 01 July 2015 to 30 June 2016 amounts to S$1,239.




136




137



HSBC Portfolios - World Selection 3 100.00 1.58 Total 100.00 1.58





II Allocation by Industry As at 30 Jun 2016 N.A., as the fund is a fund-of-funds.



HSBC FTSE All-World Index 19.81 167.60 HSBC Global Corporate Bond Strategy 17.30 146.41 HSBC ESI Worldwide Equity ETF 10.51 88.96 HSBC GIF Global High Yield Bond ZQ 10.05 85.09 HSBC GIF Global Real Estate Equity ZQ 5.12 43.34 HSBC GIF Global Emerging Mkt Loc Debt ZQ 5.07 42.93 HSBC American Index Institutional Acc 4.58 38.77 HSBC GIF Global Emerg Mkts Bd ZQ 2.98 25.23 HSBC Worldwide Equity ETF 2.89 24.50 HSBC GIF Global Corporate Bond ZQ 2.81 23.81


Global Corporate Bond strategy 25.53 222.01 HSBC FTSE All-World Index Instl Acc 19.76 171.79 HSBC ESI Worldwide Equity ETF 12.67 110.17 HSBC GIF Global High Yield Bond ZC 10.11 87.86 HSBC GIF Global Real Estate Equity ZC 5.07 44.11 HSBC GIF Global Emerg Mkts Bd ZD 5.04 43.81 HSBC GIF Global Em Mkts Local Dbt ZD 4.05 35.24 HSBC GIF Global Government Bond ZC 3.16 27.45 HSBC Worldwide Equity ETF 2.99 25.98 TOPIX INDX FUTR Sep15 2.48 21.59

V Exposure to Derivatives As at 30 Jun 2016 % of NAV 4.36% Market value (S$) 36,870,199 Realised Gains / (Losses) (S$) -Unrealised Gains / (Losses) (S$) 503,961



138





*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of HSBC Portfolios - World Selection 3 for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions HSBC Insurance World Selection 3 Fund S$1.58 million, equivalent to 100.00% of its net asset value in HSBC Portfolios - World Selection 3, which is managed by HSBC Global Asset Management (Singapore) Ltd.







139



HSBC Portfolios - World Selection 5 100.21 4.80 Other liabilities (0.21) (0.01)

Total 100.00 4.79





II Allocation by Industry As at 30 Jun 2016N.A., as the fund is a fund-of-funds.



HSBC ESI Worldwide Equity ETF 20.66 68.27HSBC Worldwide Equity ETF 17.20 56.82HSBC American Index 16.37 54.06HSBC FTSE All-World Index 12.20 40.29HSBC European Index 5.40 17.82HSBC GIF Global Real Estate Equity 5.02 16.57ISHARES CORE EM IMI UCITS ET 3.35 11.05HSBC GIF Global High Yield Bond 3.34 11.04HSBC GIF Global Emerging Mkt Loc Debt ZQ 2.96 9.78HSBC Japan Index Instl Acc 2.64 8.71


HSBC ESI Worldwide Equity ETF 19.58 82.65HSBC FTSE All-World Index Instl Acc 18.54 78.29HSBC American Index Institutional Acc 16.25 68.61HSBC Worldwide Equity ETF 14.51 61.25HSBC European Index Institutional Acc 5.48 23.14HSBC GIF Global Real Estate Equity ZC 5.17 21.84HSBC GIF Global Em Mkts Local Dbt ZD 4.09 17.28HSBC Pacific Index Institutional Acc 3.70 15.64HSBC Japan Index Instl Acc 2.70 11.42TOPIX INDX FUTR Sep15 2.49 10.53

V Exposure to Derivatives As at 30 Jun 2016% of NAV 4.53%Market value (S$) 14,969,804 Realised Gains / (Losses) (S$) -Unrealised Gains / (Losses) (S$) 470,205



140





*Based on the unaudited figures as at 31 Mar 2016 as the expense ratio of HSBC Portfolios – World Selection 5 for the financial year ended 30 Jun 2016 is not available.

II Related-Party Transactions HSBC Insurance World Selection 5 Fund S$4.80 million, equivalent to 100.21% of its net asset value in HSBC Portfolios - World Selection 5, which is managed by HSBC Global Asset Management (Singapore) Ltd.






HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: Independent Auditors’ Report to HSBC Insurance (Singapore) Pte. Limited

141

Independent Auditors’ Report to HSBC Insurance (Singapore) Pte. Limited

We have audited the accompanying financial statements of the Investment-Linked Funds (the list of Investment-Linked Funds are set out on page 4) of HSBC Insurance (Singapore) Pte. Limited (the "Company") set out on page 143 to 157 which comprise the Statements of Assets and Liabilities as at 30 June 2016, Capital and Income Accounts for the financial year / period ended 30 June 2016, and Notes to the Financial Statements (“the Statements”). The financial statements have been prepared by management based on the accounting policies set out in Note 2.

Management’s responsibility for the financial statements

Management is responsible for the preparation of the Statements in accordance with the accounting policies set out in Note 2. This includes determining that these accounting policies form an acceptable basis for the preparation of the Statements in the circumstances, and for such internal control as management determines is necessary to enable the preparation of Statements that are free from material misstatement, whether due to fraud or error.

Auditor’s responsibility

Our responsibility is to express an opinion on the Statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation of the Statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the Statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Emphasis of Matter We draw attention to Note 3 of the financial statement, which states that subsequent to year end, the company has elected to terminate HSBC Insurance SGD Reserve Fund corresponding to the closure of the underlying invested fund. Our opinion is not qualified in respect of this matter. Opinion

In our opinion, the Statements of the Investment-Linked Funds of the Company are prepared, in all material respects, in accordance with the stated accounting policies as set out in Note 2.

Basis of accounting and restriction on distribution and use

Without modifying our opinion, we draw attention to Note 2 to the Statements, which describes the basis of accounting. The Statements are prepared to assist the Company to comply with MAS Notice 307 Investment-Linked Life Insurance Policies. As a result, the Statements may not be suitable for another purpose.


142

INDEPENDENT AUDITOR’S REPORT TO HSBC INSURANCE (SINGAPORE) PTE. LIMITED (continued)

Our report is intended solely for the use of the Company and our duties are owed solely to the Company. We do not accept responsibility and we expressly disclaim liability for loss occasioned to any third party acting or refraining from acting as a result of our report.

Other matters

This report relates solely to the Statements of the Investment-Linked Funds of the Company, and does not extend to the Statements of the Company taken as a whole.

Public Accountants and Chartered Accountants

Singapore, 29 September 2016


143

The Statements of Assets and Liabilities and Capital and Income Accounts of the following Investment- Linked Funds are covered in this report:

HSBC Insurance Asia Balanced Fund HSBC Insurance Global Equity Index Fund HSBC Insurance Asia Equity Fund HSBC Insurance Global Equity Volatility Focused

Fund HSBC Insurance Asia Focused Income Fund HSBC Insurance Global High Income Bond Fund HSBC Insurance Asian Bond Fund HSBC Insurance Global Multi-Asset Fund HSBC Insurance Asian Dividend Equity Fund HSBC Insurance India Equity Fund HSBC Insurance China Balanced Fund HSBC Insurance Japan Equity Fund

HSBC Insurance China Equity Fund HSBC Insurance Pacific Equity Fund HSBC Insurance Chinese Equity Fund HSBC Insurance Premium Balanced Fund HSBC Insurance Climate Change Equity Fund HSBC Insurance Premium Property Equity Fund HSBC Insurance Emerging Europe Equity Fund HSBC Insurance SGD Reserve Fund HSBC Insurance Emerging Markets Equity Fund HSBC Insurance Singapore Balanced Fund HSBC Insurance Ethical Global Equity Fund HSBC Insurance Singapore Bond Fund HSBC Insurance Ethical Global Sukuk Fund HSBC Insurance Singapore Equity Fund HSBC Insurance Europe Dynamic Equity Fund HSBC Insurance US Equity Index Fund HSBC Insurance Europe Equity Fund HSBC Insurance US Opportunities Equity Fund HSBC Insurance Global Bond Fund HSBC Insurance World Selection 1 Fund HSBC Insurance Global Emerging Markets Bond

FundHSBC Insurance World Selection 3 Fund

HSBC Insurance Global Emerging Markets Equity Fund


HSBC Insurance Global Equity Fund

HSBC Insurance (Singapore) Pte. Limited Investment-linked Fund Report: Financial Statements

144

Financial Statements

HSBC Insurance Asia Balanced

Fund

HSBC Insurance Asia Equity

Fund


S$ S$ S$ Capital and Income Account For the Financial Year Ended 30 June 2016

Value of Fund as at 1 July 2015 3,248,664 95,800,742 1,047,986

Amounts received by the Fund for creation of units

881,328 14,398,698 294,559

Amounts paid by the Fund for liquidation of units

(229,082) (5,700,337) (250,475)

Net cash into/(out of) Fund 652,246 8,698,361 44,084

Unrealised appreciation/(diminution) in value of investments

(333,972) (16,303,968) 33,933

Gain/(Loss) on sale of investments (12,361) 718,938 599Management fees (49,406) (1,314,862) (13,061)Other expenses (1,140) (30,306) -Increase/(Decrease) in net asset value for the period

255,367 (8,231,837) 65,555

Value of Fund as at 30 June 2016 3,504,031 87,568,905 1,113,541

Statement of Assets and Liabilities As at 30 June 2016

Assets Investments in funds 3,499,711 87,609,723 1,115,326Other debtors 5,186 69,502 -Total assets 3,504,897 87,679,225 1,115,326

Liabilities Other creditors (866) (110,320) (1,785)


The accompanying notes form an integral part of these financial statements.


145

Financial Statements (Cont)

HSBC Insurance Asian Bond

Fund

HSBC Insurance Asian Dividend

Equity Fund

HSBC Insurance China Balanced

Fund S$ S$ S$

Capital and Income Account For the Financial Year Ended 30 June 2016



5,246,627 664,471 812,538


(2,204,068) (80,418) (200,563)

Net cash into/(out of) Fund 3,042,559 584,053 611,975


1,073,301 (256,745) (464,570)

Gain/(Loss) on sale of investments 122,557 3,653 3,828Management fees (282,800) (41,821) (34,248)Other expenses (9,788) - -Increase/(Decrease) in net asset value for the period

3,945,829 289,140 116,985



Assets Investments in funds 29,788,918 3,003,894 2,607,234Other debtors 20,314 6 7,287Total assets 29,809,232 3,003,900 2,614,521

Liabilities Other creditors (918) (735) (10,404)




146


HSBC Insurance China Equity

Fund

HSBC Insurance Chinese Equity

Fund*

HSBC Insurance Climate Change

Equity Fund S$ S$ S$

Capital and Income Account For The Financial Year / Period Ended 30 June 2016

Value of Fund as at 1 July 2015 99,476,461 - 2,221,435


11,990,881 157,483 688,744


(7,394,188) (436) (226,601)

Net cash into/(out of) Fund 4,596,693 157,047 462,143


(17,852,857) 3,969 (173,607)

Gain/(Loss) on sale of investments 812,435 - 40,829Other income 40,000 - -Management fees (1,323,355) (456) (36,057)Increase/(Decrease) in net asset value for the period

(13,727,084) 160,560 293,308

Value of Fund as at 30 June 2016 85,749,377 160,560 2,514,743


Assets Investments in funds 85,728,430 158,691 2,512,608Other debtors 250,258 1,873 2,139Total assets 85,978,688 160,564 2,514,747

Liabilities Other creditors (229,311) (4) (4)


*Fund was launched on 18 January 2016



147


HSBC Insurance Emerging Europe

Equity Fund

HSBC Insurance Emerging Markets

Equity Fund

HSBC Insurance Ethical Global Equity Fund

S$ S$ S$ Capital and Income Account For the Financial Year Ended 30 June 2016



2,376,988 4,561,183 1,499,506


(1,083,471) (2,743,230) (6,914,857)

Net cash into/(out of) Fund 1,293,517 1,817,953 (5,415,351)


137,013 (3,158,662) (6,125,039)

Gain/(Loss) on sale of investments (137,824) (232,555) 1,752,931Other income - - 92,743Management fees (138,314) (457,555) (916,742)Other expenses (3,191) (10,546) -Increase/(Decrease) in net asset value for the period

1,151,201 (2,041,365) (10,611,458)



Assets Investments in funds 9,846,958 30,789,018 55,283,852Other debtors 3,777 43,911 230,312Total assets 9,850,735 30,832,929 55,514,164

Liabilities Other creditors (31,483) (54,455) (199,580)




148


HSBC Insurance Ethical Global Sukuk Fund

HSBC Insurance Europe Dynamic

Equity Fund*

HSBC Insurance Europe Equity

Fund S$ S$ S$


Value of Fund as at 1 July 2015 19,627,828 - 13,498,466


198,557 156,733 6,197,482


(1,675,290) - (1,136,954)

Net cash into/(out of) Fund (1,476,733) 156,733 5,060,528


(261,353) (753) (1,854,599)

Gain/(Loss) on sale of investments 150,571 - 16,105Dividend income 708,513 - -Management fees (256,950) (481) (239,344)Other expenses (11,912) - (5,524)Increase/(Decrease) in net asset value for the period

(1,147,864) 155,499 2,977,166



AssetsInvestments in funds 18,448,885 153,543 16,478,080Cash and bank balances 32,414 - -Other debtors 10,815 1,959 98,256Total assets 18,492,114 155,502 16,576,336

Liabilities Other creditors (12,150) (3) (100,704)





149


HSBC Insurance Global Bond

Fund

HSBC Insurance Global Emerging

Markets Bond Fund

HSBC Insurance Global Emerging Markets Equity

Fund* S$ S$ S$


Value of Fund as at 1 July 2015 10,121,495 736,558 -


1,072,252 212,294 24,551


(1,417,566) (75,088) -

Net cash into/(out of) Fund (345,314) 137,206 24,551


712,589 27,310 1,229

Gain/(Loss) on sale of investments 151,275 (5,284) -Dividend income - 48,789 -Management fees (82,599) (10,213) (65)Other expenses (3,572) - -Increase/(Decrease) in net asset value for the period

432,379 197,808 25,715

Value of Fund as at 30 June 2016 10,553,874 934,366 25,715


Assets Investments in funds 10,550,685 929,979 25,719Dividend receivable - 4,475 -Other debtors 12,565 - -Total assets 10,563,250 934,454 25,719






150


HSBC Insurance Global Equity

Fund

HSBC Insurance Global Equity Index Fund*

HSBC Insurance Global Equity

Volatility Focused Fund*

S$ S$ S$ Capital and Income Account For The Financial Year / Period Ended 30 June 2016

Value of Fund as at 1 July 2015 73,845,478 - -


5,551,783 196,493 17,718


(5,080,137) (3,513) -

Net cash into/(out of) Fund 471,646 192,980 17,718


(7,645,570) (4,973) (1)

Gain/(Loss) on sale of investments 1,540,281 (65) -Management fees (1,142,382) (169) (38)Other expenses (24,679) - -Increase/(Decrease) in net asset value for the period

(6,800,704) 187,773 17,679



Assets Investments in funds 67,078,229 186,091 17,680Other debtors 18,532 1,688 -Total assets 67,096,761 187,779 17,680






151


HSBC Insurance Global High Income

Bond Fund*

HSBC Insurance Global Multi-Asset

Fund*

HSBC Insurance India Equity

Fund S$ S$ S$


Value of Fund as at 1 July 2015 - - 56,027,908


52,610 27,732 9,985,633


(4) - (4,785,746)

Net cash into/(out of) Fund 52,606 27,732 5,199,887


1,732 401 (5,574,054)

Gain/(Loss) on sale of investments - - 179,242 Management fees (160) (55) (829,172) Other expenses - - - Increase/(Decrease) in net asset value for the period

54,178 28,078 (1,024,097)

Value of Fund as at 30 June 2016 54,178 28,078 55,003,811


Assets Investments in funds 52,912 27,829 55,013,962 Other debtors 1,268 249 183,949 Total assets 54,180 28,078 55,197,911

Liabilities Other creditors (2) - (194,100)





152


HSBC Insurance Japan Equity

Fund

HSBC Insurance Pacific Equity

Fund

HSBC Insurance Premium

Balanced Fund S$ S$ S$




570,575 32,091,610 8,042,090


(314,057) (4,772,403) (8,931,252)

Net cash into/(out of) Fund 256,518 27,319,207 (889,162) Other income Unrealised appreciation/(diminution) in value of investments

(754,628) (8,392,609) (6,477,896)

Gain/(Loss) on sale of investments (19,705) (206,962) 1,940,932 - 73,000 47,000 Management fees (36,819) (1,456,873) (1,400,489) Other expenses (1,018) (35,961) - Increase/(Decrease) in net asset value for the period

(555,652) 17,299,802 (6,779,615)



Assets Investments in funds 2,554,461 109,542,657 113,044,549 Cash and bank balances - 38,530 - Other debtors 1,080 114,525 105,263 Total assets 2,555,541 109,695,712 113,149,812

Liabilities Other creditors (186) (52,405) (99,675)




153


HSBC Insurance Premium Property

Equity Fund

HSBC Insurance SGD Reserve

Fund

HSBC Insurance Singapore

Balanced Fund S$ S$ S$




388,751 2,370,410 3,927,176


(147,008) (2,244,125) (970,150)



53,661 41,131 (850,564)

Gain/(Loss) on sale of investments 21,059 8,620 (3,421) Other income 1 - - Management fees (19,885) (21,041) (222,131) Other expenses (226) (2,912) (5,490) Increase/(Decrease) in net asset value for the period

296,353 152,083 1,875,420



Assets Investments in funds 1,418,616 8,169,831 17,103,673 Cash and bank balances 2,007 - - Other debtors - 20,936 10,947 Total assets 1,420,623 8,190,767 17,114,620

Liabilities Other creditors (5,776) (21,092) (7,783)




154


HSBC Insurance Singapore Bond

Fund

HSBC Insurance Singapore Equity

Fund*

HSBC Insurance US Equity Index

Fund** S$ S$ S$


Value of Fund as at 1 July 2015 33,360,404 - -


2,866,311 685,641 217,671


(4,698,828) (4,930) (11,385)

Net cash into/(out of) Fund (1,832,517) 680,711 206,286


545,095 7,986 625

Gain/(Loss) on sale of investments 311,014 27 332 Dividend income - 7,892 - Management fees (165,709) (3,322) (146) Other expenses (11,462) - - Increase/(Decrease) in net asset value for the period

(1,153,579) 693,294 207,097



Assets Investments in funds 32,207,575 692,126 206,912 Other debtors 4,310 1,171 185 Total assets 32,211,885 693,297 207,097

Liabilities Other creditors (5,060) (3) -


* Fund was launched on 03 August 2015. ** Fund was launched on 18 January 2016



155


HSBC Insurance US Opportunities Equity Fund*

HSBC Insurance World Selection 1

Fund


Fund S$ S$ S$


Value of Fund as at 1 July 2015 - 252,472 577,409


76,886 416,023 1,070,006


(147) (47,697) (45,500)



556 8,484 (10,744)

Gain/(Loss) on sale of investments - 3,424 1,671 Management fees (229) (5,575) (14,900) Increase/(Decrease) in net asset value for the period

77,066 374,659 1,000,533



Assets Investments in funds 76,076 627,373 1,578,491 Other debtors 991 - 12,154 Total assets 77,067 627,373 1,590,645

Liabilities Other creditors (1) (242) (12,703)





156



Fund S$


Value of Fund as at 1 July 2015 1,558,337


3,639,723


(211,296)

Net cash into/(out of) Fund 3,428,427


(155,120)

Gain/(Loss) on sale of investments 8,152Management fees (45,506)Increase/(Decrease) in net asset value for the period

3,235,953

Value of Fund as at 30 June 2016 4,794,290


Assets Investments in funds 4,795,302Other debtors 1,519Total assets 4,796,821

Liabilities Other creditors (2,531)

Value of Fund as at 30 June 2016 4,794,290


157

Notes to the Financial Statements

These notes form an integral part of the financial statements.

1. HSBC Insurance (Singapore) Pte. Limited Investment-Linked Funds

1.1 The Investment-Linked Funds of HSBC Insurance (Singapore) Pte. Limited (HSBC Insurance Investment-Linked Funds) comprise:

Funds Units in issue as at 30 June 2016

HSBC Insurance Asia Balanced Fund 4,779,763 HSBC Insurance Asia Equity Fund 41,856,406 HSBC Insurance Asia Focused Income Fund 1,127,243 HSBC Insurance Asian Bond Fund 16,598,530 HSBC Insurance Asian Dividend Equity Fund 2,841,594 HSBC Insurance China Balanced Fund 2,642,223 HSBC Insurance China Equity Fund 46,911,374 HSBC Insurance Chinese Equity Fund 158,479 HSBC Insurance Climate Change Equity Fund 1,531,037 HSBC Insurance Emerging Europe Equity Fund 7,341,233 HSBC Insurance Emerging Markets Equity Fund 33,209,570 HSBC Insurance Ethical Global Equity Fund 50,200,734 HSBC Insurance Ethical Global Sukuk Fund 16,933,234 HSBC Insurance Europe Dynamic Equity Fund 153,892 HSBC Insurance Europe Equity Fund 16,654,883 HSBC Insurance Global Bond Fund 8,837,202 HSBC Insurance Global Emerging Markets Bond Fund 928,594 HSBC Insurance Global Emerging Markets Equity Fund 22,612 HSBC Insurance Global Equity Fund 53,997,808 HSBC Insurance Global Equity Index Fund 187,100 HSBC Insurance Global Equity Volatility Focused Fund 17,105 HSBC Insurance Global High Income Bond Fund 50,702 HSBC Insurance Global Multi-Asset Fund 27,597 HSBC Insurance India Equity Fund 27,759,698 HSBC Insurance Japan Equity Fund 3,770,958 HSBC Insurance Pacific Equity Fund 102,070,384 HSBC Insurance Premium Balanced Fund 79,056,755 HSBC Insurance Premium Property Equity Fund 1,592,097 HSBC Insurance SGD Reserve Fund 7,728,958 HSBC Insurance Singapore Balanced Fund 15,405,408 HSBC Insurance Singapore Bond Fund 23,819,038 HSBC Insurance Singapore Equity Fund 706,152 HSBC Insurance US Equity Index Fund 186,959 HSBC Insurance US Opportunities Equity Fund 73,443 HSBC Insurance World Selection 1 Fund 556,201 HSBC Insurance World Selection 3 Fund 1,392,777 HSBC Insurance World Selection 5 Fund 4,292,714

158

2. Summary of significant accounting policies

2.1 Basis of preparation

The financial statements of the HSBC Insurance Investment-Linked Funds are presented in Singapore dollars. The financial statements have been prepared on the historical cost basis, except for investments which are measured at fair value. .

2.2 Investments

All purchases of investments, which only comprise of unit trusts, are recognised on their trade dates, i.e. the date the commitment exists to purchase the investments. The investments are initially recorded at cost, being the consideration given and excluding acquisition charges associated with the investments. After initial recognition, the investments are subsequently measured at fair value. The unrealised gains or losses on re-measurement to fair value are taken to the Capital and Income Account within unrealised appreciation/(diminution) in value of investments after being adjusted for management fees at the underlying invested unit trust. The fair value is determined by using open market valuation at the reporting date. The quoted market price used for these investments is the quoted net asset value per unit of the unit trusts.

2.3 Amounts received by the funds for creation of units

The amounts received by the funds comprise the gross premiums received by the Company (after deducting charges which include bid-offer spread) and switches by the policyholders from other funds.

2.4 Amounts paid by the funds for liquidation of units

The amounts paid by the funds for liquidation of units comprise of the sale of units in the investment-linked funds for the payment of death claims or surrenders and for switches by the policyholders to the other funds.

2.5 Policy fees, mortality charges and other administrative fees

Policy fees, mortality charges and other administrative fees are charged to the Capital and Income Accounts by way of unit deductions.

2.6 Gains/losses from sale of investments

All sales of investments are recognised on their trade dates, the date the fund commits to sell the investments. The cost of disposal of investments is determined on the weighted-average cost basis. Realised gains/losses from the sale of investments are taken to the Capital and Income Account.

2.7 Income and expenses recognition

Dividend income is recognised in the Capital and Income Account when the right to receive payment is established. Expenses are recognised on an accrual basis.

159

2. Summary of significant accounting policies (continued)

2.8 Foreign currencies

Transactions in foreign currencies are translated into Singapore dollars at the exchange rate at the date of the transaction. Financial assets and liabilities denominated in foreign currencies at the reporting date are translated into Singapore dollars at the exchange rate at the reporting date. Foreign currency differences are recognised in the Capital and Income Account.

3. Subsequent event

Subsequent to year end, the Company has elected to terminate HSBC Insurance SGD Reserve Fund corresponding to the closure of the underlying invested fund.

160

About Us

The HSBC Group is one of the largest banking and financial services organisations in the world, with well established businesses in Europe, the Asia-Pacific region, the Americas, the Middle East and Africa. The HSBC Group evolved from The Hongkong and Shanghai Banking Corporation Limited, which was founded in 1865 in Hong Kong with offices in Shanghai and London and an agency in San Francisco.

HSBC Insurance (Singapore) Pte. Limited (”HSBC Insurance (Singapore)") is a wholly owned subsidiary of HSBC Insurance (Asia Pacific) Holdings Limited, which is ultimately owned by HSBC Holdings plc, the London-based holding company of the HSBC Group. HSBC Insurance (Singapore) provides a wide range of solutions to cater to retirement, protection, legacy planning, education and growing your wealth needs.

HSBC Insurance Singapore's financial strength

• Our financial strength currently stands at almost S$5 billion in assets as at 31 December, 2015. • Our Capital Adequacy Ratio (CAR) as at 31 December, 2015 was 204%, more than the statutory capital requirement.• A+ rating from Standard & Poor’s in 2016 thanks to our continued growth, strength of management and sound financial condition.

161

Important Notes

This report is jointly provided by HSBC Insurance (Singapore) Pte. Limited and the fund managers mentioned within this report for general information only. The specific investment objectives, personal situation and particular needs of any person have not been taken into consideration. This document is not and should not be construed as an offer to sell or solicitation of an offer to purchase or subscribe to any investment or services and HSBC Insurance (Singapore) Pte. Limited is not recommending or soliciting any action based on it.

You should read the relevant product and fund documentation, including the relevant product summary, product highlights sheets and fund summaries for details before deciding to invest. Copies of the product and fund documentation can be obtained from our authorized product distributors.

Investment involves risk and past performances of the ILP sub-funds and any other economic or market predictions, projections or forecasts, are not necessarily indicative of future or likely performances of the ILP sub-funds, underlying funds, underlying entities and/or the respective fund managers. The value of the units in the ILP sub-funds and the income accruing to the units, if any, may fall or rise, and the investor may not get back the original sum invested.

Any insurance product information mentioned is intended to provide you with a general summary and the product features are subject to change, without notice given. Information herein is also not a contract of insurance.

You should not rely on this document as investment advice. If you have any concerns about any investment products or are uncertain about the suitability of any investment decision, you should seek such financial, legal or tax advice from your professional advisers as appropriate.

Information contained in this document is obtained from sources believed to be reliable, however HSBC Insurance (Singapore) Pte. Ltd. does not guarantee its completeness or accuracy. Opinions and estimates expressed are subject to change without notice and HSBC Insurance (Singapore) Pte. Limited expressly disclaims any and all liability for representations and warranties, express or implied, contained herein, or for omissions.

HSBC Insurance (Singapore) Pte. Limited’s authorized product distributors, including The Hongkong and Shanghai Banking Corporation Limited, Singapore branch (together “the authorized product distributors”) are neither underwriters nor brokers for the customer. To the fullest extent permissible under applicable law, the authorized product distributors make no warranties or representation as to the accuracy, correctness, reliability or otherwise of the content of this document (webpage). Under no circumstances, shall the authorized product distributors or any party involved in creating, producing or delivering this document be liable to you for any direct, indirect, incidental, consequential, loss or punitive damages that result from the use of, or reliance upon, the information in this document (webpage), even if the authorized product distributors have been advised of the possibility of such damages.

The insurance products are underwritten by HSBC Insurance (Singapore) Pte. Limited. They are not obligations of deposits in or guaranteed by The Hongkong and Shanghai Banking Corporation.

Issued by HSBC Insurance (Singapore) Pte. Limited

HSBC Insurance (Singapore) Pte. Limited 21 Collyer Quay #02-01 HSBC Building Singapore 049320 Tel: (65) 6225 6111 Fax: (65) 6221 2188 Company Registration Number 195400150N

Web site: www.insurance.hsbc.com.sg

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