HSBC says profit will be hit by soaring sub-prime home-mortgage defaults
Duncan Mavin, Financial Post, with files from news services
Published: Friday, February 09, 2007
"HSBC Holdings PLC, one of the world's largest banks, is sounding alarm bells over the slowing U.S. housing market, saying its profits will be hit by soaring home-loan defaults from the sector's riskiest mortgage borrowers."
"The bank is warning that it has been forced to hike its total provision for bad loans by 20% because of defaults by sub-prime borrowers in the United States, where house-price growth is stalling."
""The impact of slowing house price growth is being reflected in accelerated delinquency trends across the U.S. sub-prime mortgage market, particularly in the more recent loans, as the absence of equity appreciation is reducing refinancing options," the U.K.- based bank said on Tuesday." Full Article.
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