{"id":115,"date":"2007-07-30T13:33:02","date_gmt":"2007-07-30T13:33:02","guid":{"rendered":"http:\/\/www.the-finance-zone.co.uk\/uncategorized\/us-worry-fails-to-dent-hsbc-profit\/"},"modified":"2007-07-30T13:33:02","modified_gmt":"2007-07-30T13:33:02","slug":"us-worry-fails-to-dent-hsbc-profit","status":"publish","type":"post","link":"https:\/\/the-finance-zone.co.uk\/index.php\/2007\/07\/30\/us-worry-fails-to-dent-hsbc-profit\/","title":{"rendered":"US worry fails to dent HSBC profit"},"content":{"rendered":"\n\n
<\/td>\n<\/tr>\n<\/table>\n

HSBC, the UK’s largest bank, has seen half-year profits rise 13% to $14.15bn (\u00c2\u00a36.97bn) despite worries about the impact of the US housing market slump.<\/span><\/strong> <\/span><\/span><\/p>\n

The firm said it had benefited from strong growth in Asia and a healthy performance from investment banking. <\/span><\/span><\/p>\n

But it said bad debt levels had risen in the US where the housing market faced “considerable difficulties”, particularly in the sub-prime sector. <\/span><\/span><\/p>\n

US authorities have warned sub-prime related losses could reach $100bn. <\/span><\/span><\/p>\n

Renegotiating loans<\/span><\/strong> <\/span><\/span><\/p>\n

Profits at the bank’s US business were 43% lower than the same period last year, reflecting its exposure to a growing number of people unable to meet their mortgage payments. <\/span><\/span><\/p>\n

Bad debt levels related to mortgage defaults totalled $760m during the period, but HSBC said total reserves set aside to cover bad debts remained largely unchanged at $2.1bn. <\/span><\/span><\/p>\n\n\n
<\/td>\n<\/tr>\n<\/table>\n

Changes to the bank’s sub-prime business, which saw HSBC stop underwriting riskier sub-prime mortgages and renegotiate thousands of customer loans, saw overall US profits improve compared with the second half of 2006. <\/span><\/span><\/p>\n

“We have contacted 19,000 customers and have modified the loans for over 5,000 of them, benefiting both our customers and our business,” the bank said. <\/span><\/span><\/p>\n

HSBC said the global credit market had remained favourable in the first half of 2007 but that it remained alert “to the probability of a change in sentiment” in the near future. <\/span><\/span><\/p>\n

Concerns about rising interest rates in most industrialised economies, allied to fears about the strength of the US economy, have caused turbulence in global stock markets in recent days. <\/span><\/span><\/p>\n

Bank charges<\/span><\/strong> <\/span><\/span><\/p>\n

Separately, HSBC said the cost of refunding British bank customers who claimed they had been overcharged for bank overdraft fees had risen to \u00c2\u00a3116m. <\/span><\/span><\/p>\n\n\n
<\/td>\n<\/td>\n<\/tr>\n<\/table>\n

Customers have launched a series of court actions against the UK’s top High Street banks, arguing that their overdraft charges are unreasonable and illegal. <\/span><\/span><\/p>\n

The banks have settled thousands of complaints out of court. <\/span><\/span><\/p>\n

“This is an industry-wide issue and the size of the refunds that we have made demonstrate our commitment to treating our customers in a fair and transparent matter,” it said. <\/span><\/span><\/p>\n

The Office of Fair Trading’s decision to challenge fees for unauthorised overdrafts in court – a case which could set a legal precedent for such claims – was welcome, HSBC added. <\/span><\/span><\/p>\n

HSBC shares rose nearly 3% in morning trading in London after analysts breathed a sigh of relief that the bank’s exposure to unrecoverable debts was not higher. <\/span><\/span><\/p>\n

“Although bad debts have surged, emerging market related profits have more than compensated,” said Keith Bowman, from Hargreaves Lansdown stockbrokers. <\/span><\/span><\/p>\n

“HSBC continues to prove that its strategy for both geographical and customer diversification is working.”<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

HSBC, the UK’s largest bank, has seen half-year profits rise 13% to $14.15bn (\u00c2\u00a36.97bn) despite worries about the impact of<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"colormag_page_container_layout":"default_layout","colormag_page_sidebar_layout":"default_layout","footnotes":""},"categories":[2,48],"tags":[],"class_list":["post-115","post","type-post","status-publish","format-standard","hentry","category-banking","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/posts\/115","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/comments?post=115"}],"version-history":[{"count":0,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/posts\/115\/revisions"}],"wp:attachment":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/media?parent=115"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/categories?post=115"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/tags?post=115"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}