Britain’s HSBC Planning to Expand in California

HSBC Holdings, Europe’s biggest bank by market value, plans to expand in states including California to offer more checking and savings accounts in the U.S., Chief Executive Stephen Green said Friday.

London-based HSBC, which gained 50 million customers in the U.S. with the $15-billion purchase of Household International Inc., now has 3 million U.S. bank accounts, mostly from 400 branches in New York state.

“We need to find a way of making sure that we can deliver banking services broadly across a customer base, which is spread through the U.S.,” Green said. “We are investing in branches outside of our traditional heartland of New York state and we are looking at direct banking.”

HSBC’s purchase of Household in 2003 made it the second-biggest U.S. provider of loans to people with spotty credit histories. Consumer-finance lending in North America accounts for 18% of the company’s $17.6 billion of annual pretax profit, while personal banking in the region makes up 6%.

Outside of New York, HSBC provides checking and savings accounts from 11 branches in Florida, eight in California and one each in Delaware, Pennsylvania, Washington, Oregon and the District of Columbia. The bank’s consumer-finance business, by contrast, offers loans from more than 1,300 branches in 45 states.

California is the biggest state for banking with more than $671 billion in deposits, followed by New York, Texas and Florida, according to the most recent data from the Federal Deposit Insurance Corp.

HSBC’s U.S. customers include about 23 million credit card holders, as well as people borrowing money to buy homes and consumer goods such as cars and household appliances.