HSBC's Departure from the Home Loan Market: What It Means for Clients
Introduction
HSBC has made the strategic decision to close its wealth and personal banking business in New Zealand. After conducting a thorough review of the rapidly evolving commercial, regulatory, and technological landscape, the bank determined that meeting the requirements to sustain a retail business would be challenging.
Commitment to Customer Support
Throughout the wind-down process, which is expected to take place over several years in a phased manner, HSBC has made a commitment to support its customers. The bank intends to honor all existing agreements, formal Letters of Offer, and pre-approval letters. Your current obligations and agreements with HSBC will be upheld.
New Home Loans
Effective June 13, 2023, HSBC will no longer accept new home loan applications or top-up requests for existing home loans. However, if you had already submitted a new home loan or top-up application before this date and received a formal Letter of Offer or pre-approval letter, HSBC will honor those agreements.
Existing Home Loans
If you have an existing home loan with a fixed-rate maturing before September 13, 2023, HSBC will offer a further fixed-rate term for a maximum of six months. This extension will allow you time to seek alternative financing options elsewhere. For loans with fixed rates maturing after September 13, your loan will automatically move to HSBC's floating rate on the maturity date. During this transition, HSBC will continue to offer variable/floating rates on home loans to facilitate your search for a new financial services provider to refinance with.
Revolving Credit Facilities
As of June 13, 2023, HSBC will no longer provide new revolving credit facilities or increase the limits of existing facilities. If you currently have an existing revolving credit facility along with other term loans from HSBC, the bank will continue to offer these solutions until the maturity date of the final term loan. However, if you are not using the credit or have plans to do so in the near future, HSBC advises you to close the facility promptly. The bank will notify you in advance regarding the closure of these facilities.
Savings Accounts
Effective June 13, 2023, HSBC will not open any new current or savings accounts. If you have a current or savings account linked to an HSBC term loan or term deposit, it must remain open until the maturity date of the final term loan or term deposit. Notably, the HSBC Debit Mastercard will cease to function after November 30, 2023. If your salary is deposited into your HSBC account or if you have regular payments associated with it, we recommend contacting another financial services provider to explore options for switching.
Personal Overdrafts
Similarly, as of June 13, 2023, HSBC will no longer offer new personal overdrafts or increases to existing overdraft facilities. If you currently have an existing personal overdraft alongside other term loans from HSBC, the bank will continue to offer these solutions until the maturity date of the final term loan. However, if you are not utilizing the overdraft facility, HSBC advises you to close it as soon as possible.
