XML 53 R41.htm IDEA: XBRL DOCUMENT v3.5.0.2
Related Party Transactions (Tables)
 9 Months Ended
Sep. 30, 2016
Related Party Transactions [Abstract]  
Summary of Related Party Transactions
The following tables and discussions below present the more significant related party balances and the income (expense) generated by related party transactions:
 
September 30, 2016
 
December 31, 2015
 
(in millions)
Assets:
 
 
 
Cash and due from banks
$
133

 
$
169

Interest bearing deposits with banks
26

 
244

Securities purchased under agreements to resell(1)
4,000

 
4,000

Trading assets(2)
17,305

 
18,632

Loans
4,463

 
4,815

Other(3)
203

 
458

Total assets
$
26,130

 
$
28,318

Liabilities:
 
 
 
Deposits
$
20,130

 
$
13,486

Trading liabilities(2)
18,391

 
19,496

Short-term borrowings
2,134

 
2,004

Long-term debt
5,832

 
1,827

Other(3)
277

 
346

Total liabilities
$
46,764

 
$
37,159

 
(1) 
Reflects overnight purchases of U.S. Treasury securities which HSBC Securities (USA) Inc. ("HSI") has agreed to repurchase.
(2) 
Trading assets and trading liabilities do not reflect the impact of netting which allows the offsetting of amounts relating to certain contracts if certain conditions are met. Trading assets and liabilities primarily consist of derivatives contracts.
(3) 
Other assets and other liabilities primarily consist of derivative balances associated with hedging activities and other miscellaneous account receivables and payables.
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2016
 
2015
 
2016
 
2015
 
(in millions)
Income/(Expense):
 
 
 
 
 
 
 
Interest income
$
30

 
$
28

 
$
90

 
$
86

Interest expense
(38
)
 
(19
)
 
(102
)
 
(41
)
Net interest income (expense)
(8
)
 
9

 
(12
)
 
45

Trading revenue (expense)
(661
)
 
72

 
138

 
441

Servicing and other fees from HSBC affiliates:
 
 
 
 
 
 
 
HSBC Bank plc
22

 
23

 
70

 
60

HSBC Finance Corporation
8

 
11

 
29

 
40

HSBC Markets (USA) Inc. ("HMUS")
5

 
6

 
15

 
19

Other HSBC affiliates
15

 
13

 
41

 
43

Total servicing and other fees from HSBC affiliates
50

 
53

 
155

 
162

Gain (loss) on instruments designed at fair value and related derivatives
193

 
(535
)
 
228

 
(405
)
Support services from HSBC affiliates:
 
 
 
 
 
 
 
HMUS
(42
)
 
(66
)
 
(150
)
 
(199
)
HSBC Technology & Services (USA) ("HTSU")
(252
)
 
(250
)
 
(734
)
 
(754
)
Other HSBC affiliates
(60
)
 
(45
)
 
(145
)
 
(145
)
Total support services from HSBC affiliates
(354
)
 
(361
)
 
(1,029
)
 
(1,098
)
Stock based compensation expense with HSBC(1)
(7
)
 
(12
)
 
(24
)
 
(40
)

 
(1) 
Employees may participate in one or more stock compensation plans sponsored by HSBC. These expenses are included in salaries and employee benefits in our consolidated statement of income. Employees also may participate in a defined benefit pension plan and other postretirement plans sponsored by HSBC North America which are discussed in Note 13, "Pension and Other Postretirement Benefits."
Schedule of Assets by Related Party
At September 30, 2016 and December 31, 2015, we have the following loan balances outstanding with HSBC affiliates:

September 30, 2016
 
December 31, 2015
 
(in millions)
HSBC Finance Corporation
$
3,013

 
$
3,014

HSBC Markets (USA) Inc. ("HMUS") and subsidiaries
473

 
978

HSBC Mexico S.A.
975

 
725

Regency Assets Limited ("Regency")(1)
—

 
58

Other short-term affiliate lending
2

 
40

Total loans
$
4,463

 
$
4,815


 
(1) 
An asset-backed commercial paper conduit consolidated by an HSBC affiliate.