HSBC may have to set aside a further $12 billion for U.S. subprime bad debts as customer defaults spread, analysts at Goldman Sachs Group Inc. said.
“The problem for HSBC now is the prospect of mounting non- performing loans and substantial losses for Household extending all the way into 2008,” analysts led by Roy Ramos in Hong Kong wrote in a note to investors dated Nov. 24. They lowered the rating on the stock to “sell’ from “neutral.” Household, now called HSBC Finance, is former predatory lender Household International. Some say the unit will be renamed as HSBC Financial.
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