HSBC 2012 Annual Report Download - page 144

HSBC HOLDINGS PLC
Report of the Directors: Operating and Financial Review (continued)
Risk > Credit risk > Summary in 2012
142
Credit quality of gross loans and advances
(Unaudited)
Europe
Hong
Kong
Rest of
Asia-
Pacific MENA
North
America
Latin
America Total
US$m US$m US$m US$m US$m US$m US$m
2012
Neither past due nor impaired ................................... 500,599 200,110 179,337 35,628 127,457 65,520 1,108,651
Of which renegotiated ........................................... 3,871 275 199 1,300 6,061 1,109 12,815
Past due but not impaired .......................................... 2,339 1,311 2,974 975 7,721 3,591 18,911
Of which renegotiated ........................................... 371 8 35 168 3104 133 3,819
Impaired .................................................................... 11,145 477 1,147 2,474 20,345 3,188 38,776
Of which renegotiated ........................................... 5,732 109 318 921 16,997 1516 25,593
2011
Neither past due nor impaired ................................... 480,173 191,691 168,571 32,550 131,785 72,534 1,077,304
Of which renegotiated ........................................... 5,136 309 264 1,532 6,570 909 14,720
Past due but not impaired .......................................... 1,990 1,107 2,319 1,165 10,216 3,212 20,009
Of which renegotiated ........................................... 282 4 47 311 4,061 168 4,873
Impaired .................................................................... 11,819 608 1,070 2,445 22,758 3,039 41,739
Of which renegotiated ........................................... 6,046 134 137 812 17,844 1,399 26,372
At 31 December 2012, US$1,109bn of gross loans
and advances were classified as neither past due nor
impaired. This was an increase of 3%, mainly in
Europe and in Rest of Asia-Pacific.
At 31 December 2012, US$19bn of gross loans
and advances were classified as past due but not
impaired compared with US$20bn at the end of
2011. The largest concentration of these balances
was in HSBC Finance. The decline of 5% was
mainly in North America due to the reclassification
of non-real estate personal loan balances to ‘Assets
held for sale’, as well as the continued run-off of the
mortgage balances in the CML portfolio. This was
partly offset by an increase in Rest of Asia-Pacific
in the personal and corporate and commercial
sectors.
Gross loans and advances classified as impaired
decreased by 7%, mainly in North America due to
the continued run-off of the CML portfolio, as well
as the reclassification of non-real estate personal
loan balances to ‘Assets held for sale’ in our CML
portfolio.
Renegotiated loans totalled US$42bn at
31 December 2012, compared with US$46bn at
the end of 2011. North America accounted for the
largest volume of renegotiated loans which
amounted to US$26bn or 62% of total renegotiated
loans at 31 December 2012 (2011: US$28bn or
62%), most of which were first lien residential
mortgages held by HSBC Finance. Of the total
renegotiated loans in North America, US$17bn were
presented as impaired at 31 December 2012 (2011:
US$18bn). Of total renegotiated loans, US$3.8bn
were presented as past due but not impaired at
31 December 2012, down from US$4.9bn at 31
December 2011. This was mainly in North America
in the CML portfolio due to the reclassification of
non-real estate personal loan balances to ‘Assets
held for sale’ as well as the continued run-off of the
lending balances.
For a more detailed analysis of the credit quality of
financial instruments, see page 154.