In Brief: Tax Deal Gives Boost to U.S. Unit of HSBC

Net income at HSBC Americas Inc. rose in the fourth quarter by 32%, to $158.6 million, yielding a 29% return on average common equity.

HSBC, the U.S. banking unit of London-based HSBC Holdings PLC, reported that net income for the year was up 12%, to $527.1 million. It posted a 25% return on equity.

The bank attributed the strong results in part to a settlement with the U.S. Internal Revenue Service over Brazilian tax credits that were disallowed in the 1980s.

The settlement boosted pretax income by $22 million and reduced net taxes by $10 million. Excluding the Brazil settlement, net fourth quarter pretax income would have been up 6%, to $171 million.

U.S. assets grew 8%, to $33.9 billion, while lending rose 11%, to $24 billion, reflecting the acquisition of $1.7 billion in commercial loans from the U.S. branches of Hongkong and Shanghai Banking Corp. by Marine Midland Bank.

Marine, a New York State regional banking institution with 375 offices, will change its name this year to HSBC Bank USA.

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER