Retained Earnings and Regulatory Capital Requirements (Tables)

3 Months Ended

Mar. 31, 2014

Capital Amounts and Ratios in Accordance With Current Banking Regulations

The following table summarizes the capital amounts and ratios of HSBC USA and HSBC Bank USA, calculated in accordance with banking regulations in effect as of March 31, 2014 and December 31, 2013.



	March 31, 2014						December 31, 2013
	Capital Amount		Well-Capitalized Minimum Ratio⁽¹⁾		Actual Ratio		Capital Amount		Well-Capitalized Minimum Ratio			Actual Ratio⁽²⁾
	(dollars are in millions)
Total capital ratio:
HSBC USA Inc.	$	20,639			16.05	%	$	20,242	10.00	%		16.36	%
HSBC Bank USA	22,267		10.00	%	18.18		21,324		10.00			18.03
Tier 1 capital ratio:
HSBC USA Inc.	14,964				11.63		14,409		6.00			11.65
HSBC Bank USA	16,732		8.00		13.66		15,763		6.00			13.33
Common equity Tier 1 ratio⁽³⁾:
HSBC USA Inc.	13,486				10.48		12,301		5.00		⁽⁴⁾	9.94
HSBC Bank USA	16,732		6.50		13.66		15,763		5.00			13.33
Tier 1 leverage ratio:
HSBC USA Inc.	14,964				8.16		14,409		3.00		⁽⁵⁾	7.90
HSBC Bank USA	16,732		5.00		9.49		15,763		5.00			9.06
Risk weighted assets:
HSBC USA Inc.	128,633						123,737
HSBC Bank USA	122,505						118,285

⁽¹⁾

HSBC Bank USA is categorized as "well-capitalized," as defined by its principal regulators. To be categorized as well-capitalized under regulatory guidelines, a banking institution must have the minimum ratios reflected in the above table, and must not be subject to a directive, order, or written agreement to meet and maintain specific capital levels. As previously discussed, the minimum regulatory ratios for a depository institution to be well-capitalized will increase in 2015 under Basel III, and the new ratios are shown above. There is no definition of a well-capitalized bank holding company under Basel III.


⁽²⁾	At December 31, 2013, capital ratios were reported according to Basel I rules and reflect the impact of the U.S. market risk final rule (known in the industry as Basel 2.5).


⁽³⁾	Basel III introduces the common equity Tier 1 ratio. For December 31, 2013, the ratios presented are the Tier 1 common ratio calculated under Basel I.


⁽⁴⁾	There was no Tier 1 common ratio component in the definition of a well-capitalized bank holding company under Basel I. The ratio shown is the required minimum Tier 1 common ratio, calculated under Basel I, as included in the Federal Reserve Board's final rule regarding capital plans for U.S. bank holding companies with total consolidated assets of $50 billion or more.


⁽⁵⁾	There was no Tier 1 leverage ratio component in the definition of a well-capitalized bank holding company under Basel I. The ratio shown is the minimum required ratio.

- Definition

Tabular disclosure of the capital amounts and ratios as of the balance sheet date, indicating whether the entity or entities are in compliance with regulatory capital requirements, by entity.

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