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HSBC is cutting back in the U.S. after its 2003 purchase of Household International Inc. required it to set aside more than $65 billion for bad loans

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HSBC Finance runoff down to 70 Billion

Reuters is reporting that Household Finance Corp’s liabilities stood at about $70 billion, Chief Executive Michael Geoghegan said in Hong Kong on Monday ahead of the bank’s annual shareholders’ meeting in London on May 28.

The unit’s run-off portfolio, which excludes its credit cards arm, was down from $78.9 billion in loans and advances at the end of 2009 and $100.4 billion at the end of 2008.

HSBC is running down its U.S. consumer finance business after losing billions of dollars as loans soured during the sub-prime housing crisis.

Earlier this month, the bank said that in the first quarter bad debts fell to their lowest level in more than two years, led by a drop in the United States.

HSBC expanded in the United States when it acquired Household Finance Corp at the beginning of the credit boom in 2003 for $14.8 billion, a deal that allowed the traditionally conservative lender to expand among U.S. subprime borrowers.

As the U.S. economy deteriorated from 2006, HSBC began to pull back from U.S. subprime borrowers and stopped originating home loans and auto financing.

See the full article, including what HSBC plans to do in China, at this location.

Posted By Timothy Blake

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UPDATE NOTE: HSBC car loans were sold to Santander USA in 2010 :: Most HSBC credit cards became Capital One credit cards in 2012 :: HSBC horrible predatory home mortgages are in run-off