HSBC Holdings, one of the leading lending institutions in the European Union, announced on September 21, 2007 that it was shutting down its U.S.-based subprime mortgage unit, Decision One Mortgage. The shutdown will result in the lost of more than 750 jobs and a writedown of $880 million. HSBC said the closure was mandated by a market that no longer makes the business sustainable.

In the past year, Decision One has restructured its operating procedures in order to continue to be profitable, but the growing incidence of defalcations in the U.S. housing market has made the closure unavoidable. in the in the past year as defaults on risky subprime loans to people with weak credit have escalated. Prior the announcement from HSBC, Decision One had centralized its loan processing and underwriting in addition to reduction in the number of operating centers.

According to the company, in the first six months of 2007, it sold about $371 million in loans originated by Decision One to its U.S. bank and recorded a pre-tax loss of $400,000 from the deal. In contrast, for the fourth quarter of 2006, the firm reported a $17 million pre-tax gain on Decision One loan sales.