November 1999: Gramm-Leach-Bliley Act guts Glass-Steagall, setting off wave of megamergers among banks and insurance and securities companies. Driving force is Sen. Phil Gramm (R-Texas), who has received $4.6 million from the financial sector over previous decade.
April 22, 2002: Georgia’s new anti-predatory law signed; Ameriquest helps lead campaign against it and announces that it won’t do business in Georgia until law is changed. Standard & Poor’s refuses to rate Georgia mortgage securities, choking credit supply to state’s home buyers; law gutted within a year.
October 2002: With the company’s stock price badly battered, Household International settled the largest predatory lending complaint in the nation’s history, agreeing to pay $484 million of shareholders’ money.
October 2002: HSBC announces acquisition of Household International. Deal closes in Spring 2003.
May 1, 2003: New Jersey’s anti-predatory-lending law signed. Again, Ameriquest and other lenders launch campaign to kill it and Standard & Poor’s says it won’t rate certain New Jersey securities; law gutted within a year.
Jan 7, 2004: Federal Office of the Comptroller of the Currency issues final rule to preempt states from applying most of their credit laws to national banks and their subsidiaries.
2005 -2006: Predatory lending becomes nationally accepted policy as subprime and liar loans become acceptable.
January 6, 2006: Ameriquest Mortgage Co. has agreed to pay $325 million to consumers and states under a predatory lending settlement announced Monday by Arizona Attorney General Terry Goddard. The $325 million payment is the second-largest state or federal consumer protection settlement in history, said Goddard. Household International, which later became HSBC Finance, had the largest predatory lending settlement.
February 8, 2007: HSBC announces they are setting aside 20 percent more than analysts estimated for loan losses in 2006 due to the companies deteriorating US mortgage business. The company announced that home loans to riskier borrowers were going bad faster than estimates. Concurrent with the announcement an index tracking swaps on sub-prime dropped sharply, indicating a significant increase in implied risk.
February 22, 2007: Two HSBC top mortgage executives announce departure from US business.
April 3, 2007: HSBC announces they will write of USD11bn to cover mounting losses in its US based HSBC Finance Corporation.
March 3, 2008: HSBC announces a USD17.2bn loss derived from the effect of the decline in the US housing market on its loan values. However, annual profits still rose 10%.
August 4, 2008: HSBC warned that conditions in financial markets are at their toughest “for several decades” after suffering a 28% fall in half-year profits. Of Europe’s top banks, HSBC has among the heaviest exposure to the troubled US housing and credit markets.
Related posts:
- HSBC disagrees with Lawrence E. Jaffe Pension Plan v. Household International, Inc
- HSBC and Household International lose jury trial in Chicago
- Household International lawsuit as HSBC goes to trial in 2009
- HSBC gave Household International 6 more years
- Presenting Household International as HSBC Consumer Lending
