HSBC Finance

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HSBC Finance Corporation
Slogan	The world's local bank
Type	Subsidiary of HSBC Holdings plc
Founded	1878
Headquarters	Prospect Heights, Chicago, United States
Key people	Siddharth N. (Bobby) Mehta, Chairman and CEO
Industry	Finance and Insurance
Products	Financial Services
Employees	43,000 (including HSBC Bank USA)
Website	www.hsbcusa.com

HSBC Finance Corporation is a financial services company and a member of the HSBC Group. It is the sixth-largest issuer of MasterCard and Visa credit cards in the United States. HSBC Finance Corporation was formed from the legal entity that had been known as Household International, and is now is expanding its consumer finance model via the HSBC Group to Brazil, India, Argentina and elsewhere.

HSBC Finance Corporation’s subsidiaries primarily provide middle-market consumers real estate secured loans, auto finance loans, MasterCard and Visa credit card loans, private label credit cards, personal non-credit card loans and specialty insurance products. Major brand names operated include the prime HSBC MasterCard, Union Plus and GM Card offerings, middle market Direct Merchants, HFC, and Beneficial brands, and the sub-prime Orchard Bank and Household cards.

Contents 1 Household International joins the HSBC Group 2 US Operations 2.1 Beneficial and HFC 2.2 Decision One 2.3 HSBC Bank Nevada NA 2.4 Private Label Cards 2.5 Predatory lending controversy in the United States 3 Global Consumer Finance 3.1 Canada 3.2 United Kingdom 3.3 Other locations 4 Bibliography 5 See also 6 External links

[edit] Household International joins the HSBC Group

HSBC acquired Household International on March 28, 2003. The acquisition was controversial: Household International had, in October 2002, settled for $486 million charges of predatory lending by attorneys general in 46 U.S. states. Household International's CEO William Aldinger became the highest-paid director in the United Kingdom, before announcing his departure in February 2005. After its integration with the HSBC Group Household International was merged with a subsidiary company and renamed HSBC Finance Corporation.

In August 2005, HSBC-N.A. announced plans to acquire Metris Companies, Inc. Metris is a credit card issuer to the U.S. middle market segment. The deal closed in early December 2005 and is an all-cash transaction worth close to US$2 billion. HSBC will insert the Metris product line including the American DreamCard (under the Direct Merchants Bank brand) into the HSBC-NA credit card family of products.

[edit] US Operations

[edit] Beneficial and HFC

Operating under the HFC and Beneficial names, HSBC Finance Corporation is the second largest consumer finance company in the United States, with more than 1,300 branches in 46 states. It provides a variety of real estate secured and unsecured loans to primarily non-prime customers, as well as increasing numbers of other product lines such as auto loans and protection policies.

[edit] Decision One

Decision One Mortgage Company directly originates real estate secured loans that are sourced through mortgage brokers.

[edit] HSBC Bank Nevada NA

HSBC Bank Nevada issues a range of HSBC branded credit cards, to both credit card only customers and customers of HSBC Bank USA. Major programs are the HSBC MasterCard and American DreamCard MasterCard.

[edit] Private Label Cards

HSBC is the third-largest issuer of private label (merchant branded) credit cards in the United States, including cards for more than 70 active merchant relationships, including Best Buy, Costco, Neiman Marcus and Saks Fifth Avenue.

[edit] Predatory lending controversy in the United States

Following the acquisition of Household International by HSBC, many customers allege being charged fees to pay their bills online or over the phone, while they also allege payments sent via mail were habitually lost or posted late to their accounts, with attendant late fees being charged^{[citation needed]}. Household International changed its name to HSBC Finance Corporation.

HSBC continues its private-label credit card business under the business name HSBC NV. The NV stands for Nevada. Some examples of private-label credit cards issued by HSBC NV have been Best Buy and Home Depot merchant charge cards. HSBC has also offered tax refund anticipation loans in a partnership with H&R Block. These loans are targetted primarily at low-income individuals and can have annualised interest rates as high as 130%^{[citation needed]}. HSBC has continued to expand its portfolio of subprime lending with the acquisition of Metris Companies, who also stand accused of predatory lending practises.

[edit] Global Consumer Finance

[edit] Canada

HSBC Finance Corporation has a Canadian operation which it inherited from Household International, since the HSBC acquisition the Canadian subsidiary works increasingly closely with HSBC Bank Canada. The unit offers mortgages, personal loans and insurance through its 115 branches in 10 provinces as well as via its 80+ merchant relationships.

[edit] United Kingdom

In the United Kingdom, HFC Bank is a mid-market consumer lender and a major provider of consumer loans and credit cards. Its branch network consists of around 150 Beneficial Finance branches, and it also operates under the marbles brand. Since Household International's acquisition by HSBC, HFC Bank has worked increasingly closely with HSBC Bank plc, including refer up/refer down arrangements and HFC introducing customers to HSBC's insurance centre.

[edit] Other locations

The techniques and experience of HSBC Finance Corporation are being increasinly exported to other HSBC markets, for example, the establishment of Proa by HSBC Bank Argentina, and new business being established in Poland by HSBC Bank Polska.

[edit] Bibliography

• HSBC North America Holdings Inc. factsheet

[edit] See also

• HSBC Group
• HSBC Bank USA
• HSBC Bank UK
• HSBC Bank Canada
• HSBC Bank Argentina
• Proa
• Marbles

[edit] External links

• HSBC USA website
• American DreamCard MasterCard website (issued by HSBC)