The Anglo-Asian group says it took a hit of US$10.6bn owing to goodwill impairment on its North American personal financial services operations Excluding the write-down, HSBC says its 2008 pre-tax profit fell 18% to US$19.9bn.

HSBC said on Monday that its net profit in the year ended December 2008 was down 70% at US$5.7bn. The Anglo-Asian banking giant also announced that it plans to shut down its HFC and Beneficial consumer finance operations in the US.

The group said that it took a hit of US$10.6bn owing to goodwill impairment on its North American personal financial services operations and believes that models of direct personal lending that depend on wholesale markets for funding are no longer viable.

Excluding the write-down, HSBC said its 2008 pre-tax profit fell 18% to US$19.9bn and its total dividend for the year will fall 29% to 64 cents. Analysts had, on average, been expecting a pre-tax profit of US$20.5bn.

Separately, HSBC is planning a £12.5bn (US$17.7bn) rights issue and said that the outlook for 2009 remains difficult, although its performance in January was ahead of expectations, especially in its global banking and markets division.

source: Indiainfoline

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