Financial Statements of HSBC USA Inc. (Parent) (Tables)

12 Months Ended

Dec. 31, 2020

Condensed Financial Information Disclosure [Abstract]

Condensed parent company financial statements follow:


Balance Sheet At December 31,	2020		2019
	(in millions)
Assets:




Securities held-to-maturity, net of allowance for credit losses of less than $1 million at December 31, 2020 (fair value of $2 million at both December 31, 2020 and 2019, respectively)	$	2	$	2

Receivables and balances due from subsidiaries	14,585		14,044
Receivables from other HSBC affiliates	1,276		2,335
Investment in subsidiaries:
Banking	21,897		21,753
Other	12		12

Other assets	182		204
Total assets	$	37,954	$	38,350
Liabilities:
Interest, taxes and other liabilities	$	85	$	137
Payables due to subsidiaries	4		3
Payables due to other HSBC affiliates	32		35
Short-term borrowings	2,998		2,476
Short-term borrowings due to subsidiaries(1)	3,000		—
Long-term debt(2)	10,695		14,595
Long-term debt due to other HSBC affiliates(2)	2,849		2,848
Total liabilities	19,663		20,094
Total equity	18,291		18,256
Total liabilities and equity	$	37,954	$	38,350

(1)Reflects a borrowing due to HSBC Bank USA which matures at the end of February 2021. The borrowing will be re-evaluated prior to its maturity date and either extended or allowed to mature.

(2)Contractual scheduled maturities for the debt over the next five years are as follows: 2021 – $3.0 billion; 2022 – $2.9 billion; 2023 – $1.5 billion; 2024 – $1.5 billion; 2025 – $3.8 billion; and thereafter – $0.8 billion.

Schedule of Condensed Income (Loss)


Statement of Income (Loss) Year Ended December 31,	2020		2019		2018
	(in millions)
Income:
Dividends from banking subsidiaries	$	121	$	138	$	137

Interest from subsidiaries	101		350		367
Interest from other HSBC affiliates	43		91		55


Other income (loss) from subsidiaries	—		2		(2)
Other income (loss) from other HSBC Affiliates	552		1,645		(829)
Other income (loss)	(544)		(1,690)		792
Total income	273		536		520
Expenses:
Interest to subsidiaries	6		—		—
Interest to other HSBC Affiliates	115		140		62
Other interest expense	228		549		574
Provision for credit losses	(1)		—		—

Other expenses with subsidiaries	15		12		8

Other expenses	3		5		2
Total expenses	366		706		646
Loss before taxes and equity in undistributed income (loss) of subsidiaries	(93)		(170)		(126)
Income tax benefit	(50)		(78)		(66)
Loss before equity in undistributed income (loss) of subsidiaries	(43)		(92)		(60)
Equity in undistributed income (loss) of subsidiaries	(897)		205		380
Net income (loss)	$	(940)	$	113	$	320

Schedule of Comprehensive Income (Loss)


Statement of Comprehensive Income Year Ended December 31,	2020		2019		2018
	(in millions)
Net income (loss)	$	(940)	$	113	$	320
Net change in unrealized gains (losses), net of tax:
Investment securities	864		403		(220)
Fair value option liabilities attributable to our own credit spread	24		(310)		324



Derivatives designated as cash flow hedges	72		8		40
Pension and post-retirement benefit plans	(4)		(14)		8
Total other comprehensive income	956		87		152
Comprehensive income	$	16	$	200	$	472

Schedule of Condensed Cash Flow Statement


Statement of Cash Flows Year Ended December 31,	2020		2019		2018
	(in millions)
Cash flows from operating activities:
Net income (loss)	$	(940)	$	113	$	320
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	2		5		8
Net change in other assets and liabilities	256		1,463		(1,277)
Undistributed (income) loss of subsidiaries	897		(205)		(380)

Other, net	(2)		4		16
Cash provided by (used in) operating activities	213		1,380		(1,313)
Cash flows from investing activities:




Net change in investments in and receivables due from subsidiaries	(552)		3,929		(1,045)
Net change in receivables from other HSBC affiliates	1,056		183		4,211
Other, net	—		1		10
Cash provided by investing activities	504		4,113		3,176
Cash flows from financing activities:
Net change in payables to other HSBC affiliates	(1)		4		(19)
Net change in short-term borrowings	3,522		(56)		1,378
Issuance of long-term debt	3,394		2,931		5,571
Repayment of long-term debt	(7,565)		(5,897)		(8,722)


Return of capital to parent	—		(2,400)		—

Other increases (decreases) in capital surplus	10		—		6
Dividends paid	(77)		(77)		(76)
Cash used in financing activities	(717)		(5,495)		(1,862)
Net change in cash and due from banks and interest bearing deposits with banks	—		(2)		1
Cash and due from banks and interest bearing deposits with banks at beginning of year	—		2		1
Cash and due from banks and interest bearing deposits with banks at end of year	$	—	$	—	$	2
Cash paid for:
Interest	$	379	$	662	$	649