HSBC posts higher full-year earnings

British banking giant HSBC posted a 21 percent increase in full-year net earnings for 2007, as strength in Asia helped the company overcome sizable impairments charges in its U.S. consumer-finance business. 

HSBC's announcement suggested that the increase in credit card delinquencies last year didn't just impact U.S.-based lenders. Amid its credit card business, "In 2007, we saw a rise in overall delinquency rates among credit card customers, in part due to a change in product mix and historically low levels of bankruptcies in 2006," HSBC Group Chairman Stephen Green said in the company announcement.

HSBC cardholders may have encountered a change in fees and lowered credit limits, while applicants with past credit problems could have been turned down when seeking an HSBC card: In addition to "modified fee practices" for its cards, HSBC said that in order "to improve the profitability of the credit card business in the long term" the bank "slowed loan and account growth by decreasing credit lines and tightening the criteria for authorizing initial credit lines."

As for whether things are looking up this year, HSBC isn't sure. "The outlook for the rest of 2008 is uncertain," HSBC said. "The economic slowdown and the credit outlook in the United States may well get worse before they get better." That could mean HSBC cardholders may continue to see credit line and fee adjustments as the bank struggles to remain profitable. 

Nevertheless, HSBC sounded a positive note, saying its "emphasis on faster growing emerging markets means that we are better positioned than many of our competitors."