HSBC Finance and HSBC USA Both Suffer Losses
On Monday, 14 May 2007, it was revealed that HSBC worldwide was once again pulled down by two US-based units, one of which was well known as predatory and questionable lender Household International.
Net income for HSBC Finance Corp., a Prospect Heights, Illinois-based lender once known as Household International Inc., fell 39 percent to $541 million (273 million pounds) from $888 million a year earlier. The unit set aside $1.7 billion for credit losses, up 96 percent from $866 million. Credit loss reserves rose to $6.8 billion from $6.59 billion at year end, and $4.47 billion a year earlier
Profit for New York-based HSBC USA Inc., which operates HSBC Bank USA, fell 11 percent from a year earlier to $273 million from $308 million. That unit set aside $205 million for credit losses, up 31 percent.
Household - HSBC Watch, an advocacy and watchdog group that monitors HSBC, said the bank never made serious changes in HSBC Finance operations. The group predicts poor earnings and a possible SEC investigation into HSBC Finance Corporation’s credit card business.
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