HSBC 2014 Annual Report Download - page 58

HSBC BANK PLC
Report of the Directors: Risk (continued)
56
Personal lending
Total personal lending
(Unaudited)
We provide a broad range of secured and unsecured
personal lending products to meet customer needs.
Personal lending includes advances to customers for
asset purchases such as residential property where the
loans are secured by the assets being acquired. We also
offer loans secured on existing assets, such as first
charges on residential property, and unsecured lending
products such as overdrafts, credit cards and payroll
loans. The following table shows the levels of personal
lending products in the various portfolios in the UK and
the rest of Europe.
Total personal lending
UK
Continental
Europe
Total
£m
£m
£m
Residential mortgage lending (A)
79,066
3,941
83,007
Of which:
– Interest-only (including endowment) mortgages
27,984
29
28,013
– Affordability mortgages, including adjustable rate mortgages
–
216
216
Other personal lending (B)
13,489
10,894
24,383
– personal loans and overdrafts
6,655
9,411
16,066
– credit cards
6,834
1,479
8,313
– motor vehicle finance
–
4
4
Total gross loans at 31 December 2014 (C)
92,555
14,835
107,390
Impairment allowances on personal lending
Residential mortgages (a)
(155)
(41)
(196)
Other personal lending (b)
(209)
(292)
(501)
– personal loans and overdrafts
(145)
(132)
(277)
– credit cards
(64)
(159)
(223)
– motor vehicle finance
–
(1)
(1)
Total impairment allowances at 31 December 2014 (c)
(364)
(333)
(697)
(a) as a percentage of A
0.20%
1.04%
0.24%
(b) as a percentage of B
1.55%
2.68%
2.05%
(c) as a percentage of C
0.39%
2.24%
0.65%
£m
£m
£m
Residential mortgage lending (D)
79,955
3,927
83,882
Of which:
– Interest-only (including endowment) mortgages
29,585
33
29,618
– Affordability mortgages, including adjustable rate mortgages
1
306
307
Other personal lending (E)
13,860
11,397
25,257
– personal loans and overdrafts
6,916
9,565
16,481
– credit cards
6,944
1,825
8,769
– motor vehicle finance
–
7
7
Total gross loans at 31 December 2013 (F)
93,815
15,324
109,139
Impairment allowances on personal lending
Residential mortgages (d)
(222)
(43)
(265)
Other personal lending (e)
(274)
(302)
(576)
– personal loans and overdrafts
(194)
(136)
(330)
– credit cards
(80)
(164)
(244)
– motor vehicle finance
–
(2)
(2)
Total impairment allowances at 31 December 2013 (f)
(496)
(345)
(841)
(d) as a percentage of D
0.28%
1.09%
0.32%
(e) as a percentage of E
1.97%
2.65%
2.28%
(f) as a percentage of F
0.53%
2.25%
0.77%
Mortgage lending
We offer a wide range of mortgage products designed to
meet customer needs, including capital repayment,
interest-only, affordability and offset mortgages. Group
credit policy prescribes the range of acceptable
residential property LTV thresholds with the maximum
upper limit for new loans set between 75% and 95%.
Specific LTV thresholds and debt-to-income ratios are
managed at regional and country levels and, although
the parameters must comply with Group policy, strategy
and risk appetite, they differ in the various locations in
which we operate to reflect the local economic and
housing market conditions, regulations, portfolio
performance, pricing and other product features.
Other personal lending
Other personal lending consists primarily of credit cards
and personal loans, both of which are generally
unsecured.
Collateral and other credit enhancements held
(Audited)
The tables below show residential mortgage lending
including off-balance sheet loan commitments by level of
collateral. They provide a quantification of the value of
fixed charges we hold over borrowers’ specific assets
where we have a history of enforcing, and are able to
enforce, collateral in satisfying a debt in the event of the
borrower failing to meet its contractual obligations, and