Shares of HSBC Holdings fell 4.66 per cent yesterday after the lender's unit in the United States announced hefty impairment charges for the third quarter.
HSBC Finance, the bank's US unit specialising in consumer finance, set aside US$4.19 billion as impairment charges for the quarter amid rising defaults in home loans.
The firm also posted a US$195 million pre-tax loss.
Still, HSBC said that for the whole group, pre-tax profit in the third quarter was higher than in the same period last year.
However, earnings for the first nine months dropped as the US unit lost US$1.44 billion after making US$10.77 billion in provisions.
Goldman Sachs put HSBC's price target and investment rating under review yesterday.
It said HSBC's nine-month profit included US$3.4 billion of fair value gain on self-issued debt and US$2.4 billion on the sale of its French regional banks.