HSBC boss vows to stand by US arm

My Account
Logout

Create an Evening Standard Account

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Welcome! Sign in here

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Forgot your password ?

Registration

* indicates fields that are mandatory

Email *

Password *

Confirm Password *

First name *

Surname *

Postcode *

Country *

Mobile phone number

Username *

Gender *

Year of birth *

When you sign up...

You will have access to all our online competitions, discounted offers and can post comments on our site.

You will also receive The Weekender newsletter sent every Thursday - it’s full of fantastic offers and ideas for the weekend. You can update your email preferences in your account page when you log in.

Other newsletters and emails

Homes & Property Newsletter - Yes I want to receive the weekly email with all the latest news on property in the capital

Occasionally we would also like to send you relevant emails detailing specific offers either from ourselves or carefully selected partners. If you would prefer not to receive these then please tick the appropriate boxes below. We will never pass on your details.

I do not want to receive additional offers and information from the Evening Standard

I do not want to receive additional offers and information sent by Evening Standard on behalf of carefully selected partners

Terms and Conditions

* I have read, understood and agree to be bound by the terms and conditions of Evening Standard

Registration

Mail Sent for Registration Confirmation.

A confirmation email has been sent. Please activate your account by clicking on the activation link sent in your mail box.

Chairman Stephen Green warned the credit position could deteriorate in North America this year, but promised the group would "work through the difficult conditions".

The amount of mortgages, loans and credit cards written off in the US leapt by nearly 80% to 11.9 billion US dollars last year as the fallout from the country's housing market crisis deepened.

Mr Green was speaking after unveiling a 10% increase in total pre-tax profits to 24.2 billion US dollars (£12.2 billion) for the bank. The figure, which was buoyed by booming Far Eastern markets, was in line with City estimates.

But the total bad debt and credit provisions hit 17.2 billion US dollars (£8.7 billion) was higher than expected - largely as a result of the US deterioration.

HSBC's problems in the US stem from its HFC consumer finance arm, which it bought in 2003 when the country's housing and credit market was booming.

But rising interest rates in recent years have seen record default rates and repossessions as higher-risk or sub-prime borrowers struggled to meet loan repayments. HSBC figures showed default rates for its entire range of consumer products in the US worsened during 2007.

The bank's directors have been under pressure from activist shareholder Knight Vinke to dispose of the HFC business and concentrate instead on growing markets like Asia.

But Mr Green said that would be irresponsible: "We are not considering getting rid of it. We think that is as unreasonable as it is unrealistic. We have every intention of working through the difficult conditions - to do anything else would be irresponsible."

The chairman added: "This year will not be an easy year in that business. I think that may overlap into next year but much depends on the US economy."