HSBC 2010 Annual Report Download - page 114

HSBC HOLDINGS PLC
Report of the Directors: Operating and Financial Review (continued)
Risk > Credit risk > Areas of special interest > US personal lending / Forbearance strategies
112
HSBC Finance foreclosed properties in the US
(Unaudited)
Quarter ended
2010
31 Dec
2010
30 Sep
2010
30 Jun
2010
31 Mar
2010 2009
Number of foreclosed properties at end of period ................ 10,940 10,940 9,798 8,394 6,961 6,188
Number of properties added to foreclosed inventory
in the year/quarter .............................................................. 20,489 5,763 5,413 5,096 4,217 14,845
Average loss on sale of foreclosed properties21 .................... 9% 15% 10% 4% 4% 12%
Average total loss on foreclosed properties22 ........................ 51% 54% 52% 49% 49% 51%
Average time to sell foreclosed properties (days) ................. 161 165 158 156 170 193
For footnotes, see page 174.
Credit cards
In our credit card and private label portfolios two
months or more delinquency balances declined
markedly, reflecting actions taken to improve credit
quality, and our customer payment rates benefited
from an increased focus by consumers on reducing
outstanding credit card debt. Two months or
more delinquent balances in our credit card portfolio
declined from US$1.8bn to US$1.0bn, while in
percentage terms they declined from 7.4% at
31 December 2009 to 4.7% at 31 December 2010.
In the private label cards portfolio, two months or
more delinquent balances declined from US$622m
to US$404m while in percentage terms delinquency
decreased from 4.1% at 31 December 2009 to 3.0%
at 31 December 2010.
Motor vehicle finance
In 2010, we sold our vehicle finance loan portfolio
and vehicle finance servicing operations. See
page 106 for details.
Other personal lending
In the US unsecured lending portfolio, two months
or more delinquency rates declined as balances
continued to run off, economic conditions generally
improved, and actions taken previously to tighten
underwriting and reduce risk in this portfolio
continued to have a favourable effect on credit
quality.
Loan delinquency
Trends in two months and over contractual delinquency in the US
(Unaudited)
Quarter ended
31 Dec
2010
30 Sep
2010
30 Jun
2010
31 Mar
2010
As
reported
31 Dec
2009
Ex. period
change
31 Dec
2009
30 Sep
2009
30 Jun
2009
31 Mar
2009
US$m US$m US$m US$m US$m US$m US$m US$m US$m
In Personal Financial
Services in the US
Residential mortgages 8,632 8,885 8,591 8,960 9,551 11,519 10,834 10,070 9,892
Second lien mortgage
lending ................... 847 907 930 1,011 1,194 1,628 1,631 1,676 1,772
Vehicle finance .......... – – 152 194 267 267 295 310 269
Credit card ................. 957 1,066 1,201 1,511 1,798 1,798 1,834 1,864 1,992
Private label ............... 404 445 478 510 622 622 639 636 659
Personal non-credit
card ........................ 811 953 987 1,194 1,548 2,619 2,680 2,709 2,855
Total ........................... 11,651 12,256 12,339 13,380 14,980 18,453 17,913 17,265 17,439
%23 %23 %23 %23 %
23 % 23 % 23 %23 %23
Residential mortgages 15.00 14.97 14.02 14.12 14.54 17.03 15.39 13.89 12.82
Second lien mortgage
lending ................... 9.10 9.23 8.98 9.17 10.14 13.35 12.71 12.35 12.59
Vehicle finance .......... – – 3.59 3.96 4.63 4.63 4.61 3.97 2.79
Credit card ................. 4.69 5.23 5.65 6.84 7.38 7.38 7.28 7.25 7.14
Private label ............... 3.03 3.56 3.80 3.78 4.12 4.12 4.38 4.08 4.28
Personal non-credit
card ........................ 9.49 10.15 9.60 10.75 12.55 19.77 18.73 18.02 18.30
Total ........................... 10.67 10.99 10.28 10.61 11.09 13.34 12.47 11.49 10.92