Global banking major HSBC's India operations reported a massive 44 per cent decline in net profit at $374 million in 2009, due to growth in loan impairment charges and deterioration in credit quality.
In the year earlier period, the bank had a net profit of $666 million, HSBC said in a statement today.
It attributed profit drop to "the growth in loan impairment charges reflected a combination of the expansion of consumer lending and credit quality deterioration in India". Its loan impairment charges and other credit risk provisions were $26,488 million in 2009, against $1,551 million in 2008.
Overall, the HSBC Group recorded a 31 per cent drop in profit at $7.07 billion for 2009.
HSBC said its profit in India declined as it had losses in personal financial services operations (retail banking) and commercial banking. India retail banking segment loss widened to $219 million in 2009 from $155 million in 2008, while commercial banking too went into losses of $41 million in 2009 from a profit of $118 million in 2008.
However, profit from its other business in the country nearly doubled to $240 million against $123 million in 2008. In commercial banking, significant deterioration was experienced in the first half.
But the overall profit for global banking and markets more than trebled to $10.5 billion. While, other banking segment like commercial banking and retail banking profit shrunk.
"Throughout the crisis, HSBC has remained profitable, financially strong and independently owned by our shareholders," it said.
