The bank said that 2011 was a year of major progress for HSBC
The bank is the biggest in Europe and makes about 90% of its profits outside the UK.
The bank singled out its “strong performance” in faster-growing markets, with revenue up 12% in Asia and Latin America, as well as in the Middle East and North Africa.
It said these regions now accounted for 49% of group revenue. It also said 2011 was a record for commercial banking.
Profit before tax in that division was up 31% at almost £5bn.
Also helping the headline profit figure was a rise of £2.5bn in the value of its debt.
The investment banking division fared less well. Profits there fell 24% to £15bn as a result of the eurozone crisis.
The UK division met its Project Merlin lending targets, set by the government.
It lent £49.4bn to businesses, well above its target of £38.8bn, with £11.9bn going to small and medium-sized enterprises (SMEs).
HSBC also increased mortgage lending by 12% to £13.2bn and expects to increase that to £15bn this year, with £3bn earmarked for first-time buyers.
Like other UK banks, HSBC has faced claims over mis-sold payment protection insurance – policies which were sold to maintain loan repayments in the event of illness or redundancy.
But in many cases, the insurance was sold to those who were not appropriate customers for the product.
The bank said it was “truly sorry” to those adversely affected by “our failings”.
Lloyds Bank last week took back £2m in bonuses from senior executives, and HSBC said it, too, had exercised “clawback”.
HSBC’s total bonus pool for the year to 31 December was £2.64bn.
The group chief executive, Stuart Gulliver, received a total pay award of £7.2m, made up of a £1.2m salary, a £2.2m bonus and long-term incentives of £3.75m, which is in shares and cannot be sold until he retires or leaves the bank.
Mr Gulliver was not the top earner this year, however. Another senior bank employee, who has not been named, will receive £8m in total.
More than 200 key employees in the UK earned a total of £53m.
The size of the remuneration was seen as inappropriate by some, partly because the bank is currently in the process of cutting 30,000 jobs worldwide as part of wide-ranging cost-cutting measures designed to save up to £2.2bn by 2013.
David Fleming, national officer at the union Unite, said: “How can Stuart Gulliver have a clear conscience over his reward package of £7.2m while thousands of staff face uncertainty about their jobs?”
The bank’s chairman, Douglas Flint, who will receive £3.4m for 2011, said he accepted that “a few people” were paid “extraordinarily well” but insisted the bank needed to attract and retain the best staff.
HSBC is the currently the most profitable Western bank, with its nearest rival, JP Morgan, reporting a profit of £12bn.
It operates in 80 countries and employs 288,000 people, 50,000 in the UK.
Mr Gulliver said: “2011 was a year of major progress for HSBC. We gained traction in our strategy designed to simplify the structure and improve the management and control of the group.
“I am pleased with our progress, but there is a lot more to do and we remain focused on delivering our targets.”