XML 51 R36.htm IDEA: XBRL DOCUMENT v3.3.1.900
Financial Statements of HSBC USA Inc. (Parent)
 12 Months Ended
Dec. 31, 2015
Condensed Financial Information of Parent Company Only Disclosure [Abstract]  
Financial Statements of HSBC USA Inc. (Parent)
Financial Statements of HSBC USA Inc. (Parent)
 
Condensed parent company financial statements follow:
Balance Sheet
At December 31,
2015
 
2014
 
(in millions)
Assets:
 
 
 
Cash and due from banks
$
—

 
$
1

Securities available-for-sale
251

 
498

Securities held-to-maturity (fair value of $4 million and $4 million at December 31, 2015 and 2014, respectively)
4

 
4

Receivables and balances due from subsidiaries
16,836

 
17,252

Receivables from other HSBC affiliates
4,733

 
6,084

Investment in subsidiaries:
 
 
 
Banking
23,828

 
19,029

Other
22

 
38

Other assets
189

 
597

Total assets
$
45,863

 
$
43,503

Liabilities:
 
 
 
Interest, taxes and other liabilities
$
155

 
$
90

Payables due to subsidiaries
2

 
28

Payables due to other HSBC affiliates
15

 
117

Short-term borrowings
1,978

 
4,772

Long-term debt(1)
21,358

 
16,976

Long-term debt due to other HSBC affiliates(1)
1,830

 
4,553

Total liabilities
25,338

 
26,536

Shareholders’ equity
20,525

 
16,967

Total liabilities and shareholders’ equity
$
45,863

 
$
43,503

 
(1) 
Contractual scheduled maturities for the debt over the next five years are as follows: 2016 –$2.9 billion; 2017 – $3.3 billion; 2018 – $6.0 billion; 2019 – $2.8 billion; 2020 – $5.2 billion; and thereafter – $3.0 billion.
Statement of Income (Loss)
Year Ended December 31,
2015
 
2014
 
2013
 
(in millions)
Income:
 
 
 
 
 
Dividends from banking subsidiaries
$
104

 
$
—

 
$
—

Dividends from other subsidiaries
1

 
1

 
1

Interest from subsidiaries
97

 
66

 
67

Interest from other HSBC affiliates
121

 
117

 
95

Other interest income
14

 
22

 
22

Other securities gains, net
1

 
—

 
—

Other income from subsidiaries
(2
)
 
(1
)
 
276

Other income from other HSBC Affiliates
(79
)
 
395

 
543

Other income
121

 
(347
)
 
(799
)
Total income
378

 
253

 
205

Expenses:
 
 
 
 
 
Interest to subsidiaries
23

 
45

 
45

Interest to other HSBC Affiliates
28

 
49

 
59

Other interest expense
375

 
266

 
231

Provision for credit losses
—

 
(3
)
 
—

Goodwill impairment
—

 
—

 
510

Other expenses with subsidiaries
—

 
23

 
—

Other expenses
6

 
182

 
124

Total expenses
432

 
562

 
969

Loss before taxes and equity in undistributed income of subsidiaries
(54
)
 
(309
)
 
(764
)
Income tax benefit
76

 
107

 
101

Loss before equity in undistributed income of subsidiaries
22

 
(202
)
 
(663
)
Equity in undistributed income (loss) of subsidiaries
308

 
556

 
325

Net income (loss)
$
330

 
$
354

 
$
(338
)


Statement of Comprehensive Income (Loss)
Year Ended December 31,
2015
 
2014
 
2013
 
(in millions)
Net income (loss)
$
330

 
$
354

 
$
(338
)
Net change in unrealized gains (losses), net of tax:
 
 
 
 
 
Investment securities
(392
)
 
176

 
(1,010
)
Other-than-temporarily impaired debt securities held-to-maturity
—

 
60

 
7

Derivatives designated as cash flow hedges
(14
)
 
(73
)
 
118

Pension and post-retirement benefit plans
—

 
(5
)
 
8

Total other comprehensive income (loss)
(406
)
 
158

 
(877
)
Comprehensive income (loss)
$
(76
)
 
$
512

 
$
(1,215
)


Statement of Cash Flows
Year Ended December 31,
2015
 
2014
 
2013
 
(in millions)
Cash flows from operating activities:
 
 
 
 
 
Net income (loss)
$
330

 
$
354

 
$
(338
)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
 
 
 
 
 
Depreciation and amortization
25

 
4

 
(2
)
Net change in other assets and liabilities(1)
517

 
(460
)
 
687

Undistributed gain of subsidiaries
(308
)
 
(556
)
 
(325
)
Net change in trading assets and liabilities
—

 
624

 
362

Other, net
(31
)
 
(36
)
 
(16
)
Cash provided by (used in) operating activities
533

 
(70
)
 
368

Cash flows from investing activities:
 
 
 
 
 
Purchases of securities
(56
)
 
—

 
(139
)
Sales and maturities of securities
298

 
21

 
208

Net change in loans
—

 
26

 
5

Net change in investments in and receivables due from subsidiaries
(4,489
)
 
(6,003
)
 
365

Net change in receivables from other HSBC affiliates(1)
835

 
(764
)
 
(592
)
Other, net
(38
)
 
—

 
—

Cash provided by (used in) investing activities
(3,450
)
 
(6,720
)
 
(153
)
Cash flows from financing activities:
 
 
 
 
 
Net change in short-term borrowings
(2,794
)
 
1,393

 
(1,643
)
Issuance of long-term debt
11,946

 
8,013

 
4,401

Repayment of long-term debt
(9,870
)
 
(2,554
)
 
(2,875
)
Preferred stock redemption
(300
)
 
—

 
—

Capital contribution from parent
4,000

 
—

 
—

Other increases (decreases) in capital surplus
(1
)
 
4

 
(17
)
Dividends paid
(65
)
 
(73
)
 
(73
)
Cash provided by (used in) financing activities
2,916

 
6,783

 
(207
)
Net change in cash and due from banks
(1
)
 
(7
)
 
8

Cash and due from banks at beginning of year
1

 
8

 
—

Cash and due from banks at end of year
$
—

 
$
1

 
$
8

Cash paid for:
 
 
 
 
 
Interest
$
406

 
$
363

 
$
321


 
(1) 
During 2015, we concluded that changes in receivables from other HSBC affiliates would be better presented as cash flows from investing activities. As a result, we reclassified $764 million and $592 million of cash flows from net change in other assets and liabilities to net change in receivables from other HSBC affiliates during 2014 and 2013, respectively, to conform with the current year presentation.
HSBC Bank USA is subject to legal restrictions on certain transactions with its non-bank affiliates in addition to the restrictions on the payment of dividends to us. See Note 23, "Retained Earnings and Regulatory Capital Requirements," for further discussion.