Sorry to report this, but it was inevitable.
HSBC, New Century warn of US subprime lending woes
NEW YORK, Feb 7 (Reuters) - Two of the biggest lenders to Americans with poor credit histories said on Wednesday rising subprime mortgage defaults will weigh unexpectedly on results.
HSBC Holdings Plc, Europe's biggest bank, said it plans to set aside $10.6 billion companywide for bad debts, 20 percent more than the $8.8 billion it said analysts expected on average, because of struggles in its HSBC Finance Corp. lending business.
Chief Executive Michael Geoghegan is directly involved in trying to fix the problems, it said.
Meanwhile, New Century Financial Corp. projected a fourth-quarter loss, and said it expects to restate each of the previous three quarters' earnings lower because it did not set aside enough money to buy back subprime loans that went bad. Analysts polled by Reuters Estimates had on average forecast a fourth-quarter profit of $1.06 per share.
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