HSBC CLOSES LENDING UNITS; 6,100 CUT

By KAJA WHITEHOUSE

Last updated: 4:20 am
March 3, 2009
Posted: 4:20 am
March 3, 2009

Getting a loan just got a lot tougher.

British bank HSBC, often referred to as the nation's second-largest provider of US consumer loans, announced yesterday that it's shuttering two units dedicated to consumer lending.

The closure of the two units - HFC and Beneficial - will result in 6,100 job losses and the closing of 800 branches that provide mortgage refinancing and personal loans, among other forms of debt financing.

Beneficial has three branches in the New York area, including one in Brooklyn and another in Sunnyside, Queens, according to the firm's Web site. HFC also has three branches in the region, including one in Bayside, Queens.

HSBC's bank branches, which are scattered throughout Manhattan and the boroughs, won't be affected. HSBC will continue to underwrite residential mortgages through the bank branches, said a spokeswoman for the company.

The move comes as the parent company, HSBC Holdings, reported a 70 percent drop in 2008 net profit amid losses tied to the US mortgage and subprime loans.

The company, one of the few to have avoided a government bailout, is seeking to raise $17.7 billion from shareholders through a share sale.