HSBC finance settles household international case for £1.1bn

Picture: Joe Giddens/PA Wire

Picture: Joe Giddens/PA Wire - Credit: PA

HSBC's finance unit is to fork out almost 1.6 billion US dollars (£1.1 billion) to settle a long- running legal case linked to its acquisition of Household International in 2003.

The 14-year-old class action has seen shareholders in Household accuse HSBC Finance Corporation of misleading them over lending practices and of inflating its share price.

The settlement is subject to court approval and is expected to result in a pre-tax charge of approximately 585 million US dollars (£413 million) in the second quarter of 2016.

Earlier this month, HSBC said it would press ahead with a restructure of its global banking division to make it 'more agile' and save tens of millions of dollars in costs.

The banking giant told staff in a memo that it would bring together its sector bankers and its product bankers into one area of the business.

The shake-up will lead to the creation of the Corporate, Financials and Multinationals Banking group.

The bank announced at the end of February that it would merge capital financing and banking to create a single global banking division.