HervÃ© Falciani, an IT specialist at the Geneva branch, is thought to have committed the theft three years ago.
The crime, which was discovered during 2009, affected accounts opened before October 2006, 9,000 of which have subsequently been closed, the bank announced.
Alexandre Zeller, chief executive of the Swiss subsidiary, said: âWe deeply regret the situation and unreservedly apologise to our clients for this threat to their privacy.â
HSBC is only thought to have recently uncovered the full extent of the crime perpetrated by its ex-employee.
Tax authorities in France seized the data and increased diplomatic tensions between the two countries after it announced the information would be used to crackdown on French taxpayers with Swiss accounts.
However, both countries subsequently agreed to not use the data to implement an investigation into tax evasion.
In a statement, HSBC said it did not believe that the stolen information had been used to allow third parties to access client accounts.
The bank has subsequently invested approximately $93 million on upgrading security surrounding its IT systems.
By Jim Ottewill