HSBC reveals write-down of $ 16 billion
Filed Under: Business, Featured, International Business
The largest bank in the UK, HSBC is expects to reveal its loss of $ 16 billion for the year 2007. However it will still make its annual profit. The firms’ annual report will show that the main reason for the poor debt charge is chiefly due to the crumbling housing market of the US and consumer blues.
However the firm still believes that the profits would rise to $ 25 billion, from the $ 22 billion that was incurred the previous year. The US banks have also fared far better than their rivals in the credit crises. The HSBC is the last of the five British banks to report their earnings for the tear 2007.
The Royal Bank of Scotland, HBOS, Barclays and Lloyds TSB has already filed their figures. They have made a loss of around £5 billion together with the various small lenders. According to an observer, the losses were due to the declining value of investments that were linked with the US-prime mortgage crises.
The firm’s write-down was published in almost all the newspapers and would be two thirds greater than the impairment provision that was provided for the year 2006. The loss is said to increase the pressure on the banks management from the various shareholders to refurbish its existing policy in aspect to its worried US arm HSBC Finance Corporation.
Investment groups now want HSBC to primarily focus on increasing their markets in Asia. HSBC has reassured its investors with a brighter future by lifting their dividend payout to shareholders by 10%.
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