Household HSBC Watch

HSBC USA has established a second nationally chartered bank, based in Maryland, to make it easier for the British-owned bank to expand its U.S. branch network. The new HSBC National Bank USA is a sister to Delaware-based HSBC Bank USA, which now operates all but one of HSBC’s U.S. branches, including all of those in New York State.

Like the existing bank, HSBC National Bank will offer a full range of products, and the two banks will provide account services to each other’s customers as well, including cashing checks, paying withdrawals, taking or renewing deposits, closing and servicing loans, and providing support services for accounts. As a result, customers will not see any difference.

“Basically, we want this to be as seamless as possible to our customers,” said spokeswoman Kathleen Rizzo Young.

The new bank charter is critical to the company’s continued U.S. expansion, officials said. Banks with branches in more than one state operate under their home state’s laws. And while Delaware’s laws are better for certain loans and business lines, Maryland’s are more favorable and flexible for interstate branching, HSBC officials said, adding that they’ve been working with regulators on their strategy.

HSBC will continue using its original, primary charter to expand in states in which it already operates, or for commercial banking offices and other business lines. But it will use the new Maryland charter to enter and expand on the retail side in new states, including Connecticut, where the charter already “played a key role,” said HSBC Bank USA Chief Operating Officer Brendan McDonagh.

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