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HSBC Holdings PLC06 March 2006 PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.-------------------------------------------------------------------------------- DIRECTORS Set forth below is certain biographical information relating to the members ofHSBC Finance Corporation's Board of Directors. Each director is electedannually. There are no family relationships among the directors. WILLIAM R. P. DALTON, age 62, joined HSBC Finance Corporation's Board in April2003. Mr. Dalton retired in May 2004 as an Executive Director of HSBC Holdingsplc, a position he held from April 1998. He also served HSBC as Global Head ofPersonal Financial Services from August 2000 to May 2004. From April 1998 toJanuary 2004 he was Chief Executive of HSBC Bank plc. Mr. Dalton held positionswith various HSBC entities for 24 years. Mr. Dalton is a member of the Compensation Committee. GARY G. DILLON, age 71, joined HSBC Finance Corporation's Board in 1984. Mr.Dillon retired as Chairman of the Board of Schwitzer Group (a manufacturer ofengine components) on March 1, 1999. He had served as Chairman of Schwitzer from1991 and Chief Executive Officer of Schwitzer from 1989. From 1989 to 1997 healso served as President of Schwitzer. Prior to 1989 he was President and ChiefExecutive Officer of Household Manufacturing, Inc., the former diversifiedmanufacturing subsidiary of HSBC Finance Corporation. 189 Mr. Dillon is a member of the Compensation, Executive, Offering and AuditCommittees. J. DUDLEY FISHBURN, age 59, joined HSBC Finance Corporation's Board in 1995. Mr.Fishburn became Chairman of the Board of HFC Bank Ltd. (HSBC FinanceCorporation's primary subsidiary in the United Kingdom) in 1998. He previouslyserved as the Conservative Member of Parliament for Kensington in London from1988 to 1997. Prior to entering Parliament, Mr. Fishburn was Executive Editorfor The Economist Newspaper Ltd. from 1979 until 1988. He is also a Director ofAltria Inc., First NIS Fund (Luxembourg), Henderson Smaller Companies InvestmentTrust plc, The Beazley Group plc, and a Trustee of The Peabody Trust. Mr. Fishburn is a member of the Nominating & Governance Committee. CYRUS F. FREIDHEIM, JR., age 70, joined HSBC Finance Corporation's Board in1992. Mr. Freidheim served as Chairman of the Board and Chief Executive Officerof Chiquita Brands International, Inc. from March 2002 until January 2004 andChairman until May 2004. In March 2002, he retired as Vice Chairman of Booz,Allen & Hamilton, Inc. (a management consulting firm), with which he had beenaffiliated since 1966. He is also a Director of Allegheny Energy, Inc.,Hollinger International, Inc. and SITEL Corp., Inc. and a Trustee of ThunderbirdGalvin School of Institutional Management and a Trustee of the BrookingsInstitution. He was a director until March 2002 of Arasys, Inc. andPharmaceutical Industries LLC and until May 2000 of Security Capital Group, Inc. Mr. Freidheim is the Lead Director and a such is the Chair of the ExecutiveCommittee and an ex-officio member of the Audit, Compensation and Nominating andGovernance Committees. ROBERT K. HERDMAN, age 57, joined HSBC Finance Corporation's Board in 2004. Healso serves as a member of the Board of Directors of HSBC North AmericaHoldings, Inc. Mr. Herdman is a Managing Director of Kalorama Partners LLC, aWashington, D.C. consulting firm. Mr. Herdman was the Chief Accountant of theU.S. Securities and Exchange Commission from October 2001 to November 2002. TheChief Accountant serves as the principal advisor to the Commission on accountingand auditing matters, and is responsible for formulating and administering theaccounting program and policies of the Commission. Prior to joining the SEC, Mr.Herdman was Ernst & Young's Vice Chairman of Professional Practice for itsAssurance and Advisory Business Services (AABS) practice in the Americas and theGlobal Director of AABS Professional Practice for Ernst & Young International.Mr. Herdman was the senior E&Y partner responsible for the firms' relationshipswith the SEC, Financial Accounting Standards Board (FASB) and American Instituteof Certified Public Accountants (AICPA). He was on the AICPA's SEC PracticeSection Executive Committee (1995-2001) and a member of the AICPA's Board ofDirectors (2000-2001). Mr. Herdman is a member of the Board of Directors ofWestwood One, Inc. (chair of the Audit Committee and member of the Nominatingand Governance Committee), and a member of the Board of Advisors of EPG, Inc., afamily-owned business in Aurora, Ohio and of Stadia Capital LLC, a New Yorkhedge fund. Mr. Herdman is Chair of the Audit Committee. ALAN W. JEBSON, age 56, joined HSBC Finance Corporation's Board in 2003. He isan Executive Director and the current Chief Operating Officer of HSBC withresponsibility for HSBC's worldwide operational functions and for managingcertain head office departments. Mr. Jebson has announced his intention toretire from HSBC effective May 2006. Mr. Jebson joined The Hongkong and ShanghaiBanking Corporation Limited in 1978 as Manager Computer Audit before servingwith The Saudi British Bank in technical services and planning roles. He hasworked in various IT capacities in Hong Kong and London for HSBC from 1978 untilbecoming its Chief Operating Officer in June 2003. He served as Group GeneralManager, Information Technology in April 1996 and was appointed Group ITDirector and an Executive Director of HSBC Holdings in 2000. Mr. Jebson is an ex-officio member of the Audit Committee. GEORGE A. LORCH, age 64, joined HSBC Finance Corporation's Board in 1994. InAugust 2000, Mr. Lorch became a Chairman Emeritus of Armstrong Holdings, Inc.From May until August 2000, Mr. Lorch served as Chairman and President and ChiefExecutive Officer of Armstrong Holdings, Inc. (the parent of Armstrong 190 World Industries, Inc.). Mr. Lorch served as Chairman of the Board of ArmstrongWorld Industries, Inc. (a manufacturer of interior finishes) from 1994 andPresident and Chief Executive Officer from 1993 until May 2000. Mr. Lorch is aDirector of The Williams Companies, Inc., Autoliv, Inc. and Pfizer Inc. Mr. Lorch is Chair of the Compensation Committee and a member of the Nominating& Governance Committee. SIDDHARTH N. MEHTA, age 47, is the Chairman and Chief Executive Officer of HSBCFinance Corporation since May 2005 and Chief Executive Officer of HSBC NorthAmerica Holdings Inc. since March 2005. He is also Group Managing Director ofHSBC Holdings plc, with responsibility for the strategic management of consumerfinance and credit cards throughout the HSBC Group. Mr. Mehta joined HSBCFinance Corporation in 1998 as Group Executive - Credit Card Services. Prior tojoining HSBC Finance Corporation, Mr. Mehta was Senior Vice President at TheBoston Consulting Group in Los Angeles and co-leader of Boston Consulting GroupFinancial Services Practice in the United States. Mr. Mehta serves on the boardof directors for MasterCard International, U.S. region, and the board ofinternational advisors for the Monterey, California, Institute of InternationalStudies. He is a member of the Financial Services Roundtable and serves on theboard of advisors for the Myelin Repair Foundation, a not-for-profitorganization working to fund research for multiple sclerosis. Mr. Mehta is a member of the Executive Committee. LARREE M. RENDA, age 47, joined HSBC Finance Corporation's Board in 2001. Ms.Renda has been employed by Safeway Inc. since 1974. She became Executive VicePresident, Chief Strategist and Administrative Officer in November, 2005. Priorto her current position she served as Executive Vice President for RetailOperations, Human Resources, Public Affairs, Labor and Government Relationssince 1999. Prior to this position, she was a Senior Vice President from 1994 to1999, and a Vice President from 1991 to 1994. She is also a director andChairwoman of the Board of The Safeway Foundation and serves on the board ofdirectors for Casa Ley, S.A. de C.V. in which Safeway Inc. holds a 49% interest.Ms. Renda is a member of the Retailing Initiative Advisory Board of the WhartonSchool of Business and serves as a trustee on the National Joint LaborManagement Committee. Additionally she serves on the board of directors of boththe California and U.S. Chamber of Commerce. Ms. Renda is Chair of the Nominating & Governance Committee and a member of theAudit Committee. 191 EXECUTIVE OFFICERS Information regarding the executive officers of HSBC Finance Corporation as ofMarch 6, 2006 is presented in the following table. ----------------------------------------------------------------------------------------------- YEARNAME AGE APPOINTED PRESENT POSITION-----------------------------------------------------------------------------------------------Siddharth N. Mehta 47 2005 Chairman and Chief Executive OfficerSandra L. Derickson 52 2000 Vice ChairmanDavid D. Gibbons 50 2004 Senior Executive Vice President - Chief Risk OfficerSimon Penney 57 2003 Senior Executive Vice PresidentKenneth H. Robin 59 1989 Senior Executive Vice President - General Counsel & Corporate SecretaryAndrew C. Armishaw 43 2004 Group Executive - Chief Information OfficerJames B. Kauffman 58 2002 Executive Vice President - Policy & ComplianceSteven B. Gonabe 54 2005 Executive Vice President - AdministrationLisa M. Sodeika 42 2004 Executive Vice President - Corporate AffairsBeverley A. Sibblies 44 2004 Senior Vice President - Chief Financial OfficerJ. Denis O'Toole 61 2003 Senior Vice President - Government RelationsFaye M. Polayes 54 2004 Senior Vice President - TaxesEdgar D. Ancona 53 2002 Senior Vice President - TreasurerBruce A. Fletcher 45 2005 Senior Vice President - Chief Credit OfficerPatrick A. Cozza 50 2004 Group ExecutiveThomas M. Detelich 49 2002 Group ExecutiveWalter G. Menezes 60 2004 Group ExecutiveJohn J. Haines 42 2004 Managing Director - Auto FinanceJoseph W. Hoff 55 2005 Managing Director - Retail ServicesGary R. Esposito 45 2005 Managing Director - Mortgage ServicesJames E. Binyon 42 2006 Vice President and Chief Accounting Officer----------------------------------------------------------------------------------------------- Sandra L. Derickson, Vice Chairman of HSBC Finance Corporation since May 2004and Group Executive of HSBC North America Holdings Inc. since August 2004. FromMay 2001 to August 2002 she served as Managing Director-Retail Services ofHousehold International, Inc., and from August 2002 to May 2004 she served asGroup Executive with responsibilities for insurance, taxpayer financial servicesand auto finance businesses and the HFC Bank - UK operations, as well as theprivate label credit card operations. Prior to joining HSBC Finance CorporationMs. Derickson was an officer at General Electric Company from 1991 until 1999.Ms. Derickson is also a member of the Board of Directors of Hexcel Corporation. David D. Gibbons, Senior Executive Vice President, Chief Risk Officer of HSBCFinance Corporation and of HSBC North America Holdings Inc. since March 2004.Prior to that Mr. Gibbons was Deputy Comptroller for Special Supervision fromOctober 2002 to March 2004, Mr. Gibbons was with the OCC from September 1977 toMarch 2004 and Deputy Comptroller of the Currency for Credit Risk from 1997 to2002. Simon Penney, Senior Executive Vice President of HSBC Finance Corporation sinceMay 2003 and Senior Executive Vice President and Chief Financial Officer of HSBCNorth America Holdings Inc. since January 2004. From May 2003 until October 2005Mr. Penney served as Chief Financial Officer of HSBC Finance Corporation. From1995 to April 2003 he was Chief Financial Officer and a member of the executivecommittee of the Hongkong and Shanghai Banking Corporation Limited. In 1999 hewas also appointed a non-executive director and a member of the audit committeeof Hang Seng Bank Ltd., a 62.14% owned subsidiary of HSBC. Mr. Penney has spenta total of 23 years working for various subsidiaries of the HSBC Group. 192 Kenneth H. Robin, Senior Executive Vice President, General Counsel and CorporateSecretary of HSBC Finance Corporation since May 2003 and Senior Executive VicePresident, General Counsel and Corporate Secretary of HSBC North AmericaHoldings Inc. since January 2004. Prior to that Mr. Robin was Senior VicePresident, General Counsel and Corporate Secretary of Household International,Inc., the predecessor of HSBC Finance Corporation, since 1993. Andrew C. Armishaw, Group Executive and Chief Information Officer of HSBCFinance Corporation and Senior Executive Vice President and Chief InformationOfficer of HSBC North America Holdings Inc. since January 2004. From January2001 to December 2003 Mr. Armishaw was Head of Global Resourcing for HSBC andfrom 1994 to 1999 was Chief Executive Officer of First Direct (a subsidiary ofHSBC) and Chief Information Officer of First Direct. James B. Kauffman, Executive Vice President of Policy and Compliance of HSBCFinance Corporation and of HSBC North America Holdings Inc. since February 2004.Mr. Kauffman joined HSBC Finance Corporation in June 2002 as Vice President ofCompliance and became Executive Vice President on February 2004. From March 2001to June 2002 Mr. Kauffman served as Secretary of Banking of the Commonwealth ofPennsylvania, served as Chairman of the Board of Directors of the PennsylvaniaHousing Finance Agency and sat on several other state economic developmentboards. From January 1994 to December 1998, Mr. Kauffman served as Chairman andChief Executive Office of Keystone Bank. Mr. Kauffman also served as ChiefCredit Policy Officer for Keystone Financial, Inc. from January 1994 to December1998. Steven B. Gonabe, Executive Vice President of Administration of HSBC FinanceCorporation and of HSBC North America Holdings Inc. since July 2005. From June1997 to July 2005 Mr. Gonabe was Vice President of Human Resources for HSBCcredit card services, auto finance and mortgage services businesses and nationaldirector of human resources for the credit card services group. Mr. Gonabeserves on the board of directors for the United Way of Monterey County and is amember of the Junior Achievement of Silicon Valley and Monterey Bay, California. Lisa M. Sodeika, Executive Vice President of Corporate Affairs of HSBC FinanceCorporation and of HSBC North America Holdings Inc. since June 2005. Ms. Sodeikadirects HSBC North America's public relations, CRA-community development,consumer affairs, communications, philanthropic services and governmentrelations activities. From January 2003 to June 2005 Ms. Sodeika was Senior VicePresident - Corporate Affairs and Vice President - Consumer Affairs. FromOctober 2000 to December 2002 Ms. Sodeika served as Executive Assistant to thegroup executive of consumer lending and to the Vice Chairman of HouseholdInternational, Inc., and from January 2000 to October 2000 held the position ofVice President - Underwriting for the consumer lending division. Beverley A. Sibblies, Senior Vice President and Chief Financial Officer of HSBCFinance Corporation and Executive Vice President of Finance of HSBC NorthAmerica Holdings Inc. since October 2005. Ms. Sibblies joined HSBC FinanceCorporation in December 2004 as the Senior Vice President and Chief AccountingOfficer. Prior to joining HSBC Finance Corporation, she served as Executive VicePresident and Chief Financial Officer for EMC Mortgage from June 2000 toFebruary 2004. Prior to that, she served as a partner in the financial servicespractice of Deloitte & Touche, LLP from July, 1997. J. Denis O'Toole, Senior Vice President of Government Relations of HSBC FinanceCorporation since January 2003. From September 1992 to December 2002 Mr. O'Toolewas Vice President of Government Relations and in 1992 was hired as VicePresident and Director of HSBC Finance Corporation's Federal governmentrelations office. From January 1989 to August 2005 Mr. O'Toole was the ExecutiveVice President of the Saving and Community Bankers of America, from May 1978 toDecember 1988, Director of Legislative Operations and Senior Federal LegislativeCounsel to the American Bankers Association, from April 1973 to April 1978, VicePresident of Government Relations to the National Association of Home Builders,and from April 1972 to March 1973, a litigation attorney for the Office ofGeneral Counsel of the U.S. Department of Housing. Faye M. Polayes, Senior Vice President of Tax for HSBC Finance Corporation sinceJanuary 2004. She has been Executive Vice President, Tax for HSBC North AmericaHoldings Inc. since January 2004 and 193 Executive Vice President, Tax for HSBC Bank USA since January 1, 2000. IncludingMs. Polayes 18 years at Republic National Bank of New York as Tax Counsel, shehas been with HSBC for 23 years. Ms. Polayes has served on the Board ofDirectors of the Organization for International Investment ("OFII") since June2005. OFII is a not-for-profit organization whose members are foreign owned U.S.corporations. It provides information to its members regarding legislative andregulatory matters of common concern and lobbies on the Federal and state levelin connection with proposed legislation. Ms. Polayes has served on the Board ofDirectors of the Jump Rhythm Jazz Project, a Chicago based dance company whichis a not-for-profit corporation, since December, 2005. Edgar D. Ancona, Senior Vice President and Treasurer of HSBC Finance Corporationand Executive Vice President - Asset and Liability Management of HSBC NorthAmerica Holdings Inc. since February 2004. Mr. Ancona joined HSBC FinanceCorporation in 1994, after having spent 17 years at Citicorp in various treasuryand operational functions. He is a director of HSBC Financial CorporationLimited in Canada. Mr. Ancona is also a director of the LifeSource BloodServices and the Central Blood Bank. Bruce A. Fletcher, Senior Vice President and Chief Credit Officer of HSBCFinance Corporation since April, 2005. Prior to joining HSBC FinanceCorporation, Mr. Fletcher served as Managing Director and Senior Credit Officerfor Citigroup, where during a period of more than 15 years he held a variety ofline and staff risk management positions. Patrick A. Cozza, Group Executive of HSBC Finance Corporation since April 2004.Prior to that Mr. Cozza became President - Refund Lending and Insurance Servicesin 2002 and Managing Director and Chief Executive Officer - Refund Lending in2000. He also serves on the board of directors of Junior Achievement in NewJersey and Cancer Hope Network. Thomas M. Detelich, Group Executive of HSBC Finance Corporation since July 2002.Mr. Detelich also held the positions of Managing Director at BeneficialCorporation from March 2000 to July 2002 and Managing Director of HouseholdFinance Corporation from January 1999 to July 2002 and regional general managerof consumer lending. Mr. Detelich was formerly with Transamerica in severalmanagement positions. He was with Transamerica for 21 years. Walter G. Menezes, Group Executive of HSBC Finance Corporation since April 2004and is responsible for HSBC Finance Corporation's credit card and private labelcredit card operations. Mr. Menezes held the title of President and ChiefExecutive Officer for Auto Finance from 2002 to August 2004 and ManagingDirector and Chief Credit Officer of Credit Card Services since from 1998 to2002. He joined HSBC Finance Corporation in 1996 as National DirectorCollections - Credit Card Services. John J. Haines, Managing Director of Auto Finance of HSBC Finance Corporationsince joining HSBC Finance Corporation in August 2004. From May 1989 to August2004 Mr. Haines worked for General Electric where he was Senior Vice President -Products and Services for General Electric Fleet Services and Senior VicePresident - North American Operations for General Electric Fleet Services. Mr.Haines is a member of the Automotive Finance Committee of the Consumer BankersAssociation. Joseph W. Hoff, Managing Director of Retail Services of HSBC Finance Corporationsince March 2005. Mr. Hoff served as Chief Financial Officer for the RetailServices business from April 1995 to March 2005. He has been with HSBC FinanceCorporation since 1976 in various accounting and planning, acquisitions andcorporate finance lending and treasury positions. Gary R. Esposito, Managing Director of Mortgage Services of HSBC FinanceCorporation since September 2005. Prior to that Mr. Esposito held the positionof Head of Consumer Lending Sales from November 2003 to September 2005 and wasthe President, Chief Executive Officer and Chairman for HSBC Canada fromSeptember 2000 to November 2003. He was also National Director, branch andretail operations from 1998 through 2000. He has been with HSBC FinanceCorporation since 1982. James E. Binyon, Vice President and Chief Accounting Officer since February2006, and from September 2004 was Vice President and Controller of CorporateFinance. From November 2001 to August 2004 he served as Finance Director ofFirst Direct, and from February 1995 to October 2001 was Senior Area 194 Accounting Manager, and Manager - Balance Sheet Management for HSBC Hong Kong.Mr. Binyon was Manager-Asset Management & Funding, and Manager - Treasury AuditDepartment between 1992 and 1995. Prior to joining HSBC, Mr. Binyon spent fiveyears at KPMG. AUDIT COMMITTEE The primary purpose of the audit committee is to assist the Board of Directorsin fulfilling its oversight responsibilities relating to HSBC FinanceCorporation's accounting, auditing and financial reporting practices. The auditcommittee is currently comprised of the following independent Directors (asdefined by HSBC Finance Corporation's Corporate Governance Standards which arebased upon the rules of the New York Stock Exchange): Gary G. Dillon; Robert K.Herdman and Larree M. Renda. In addition, Cyrus F. Freidheim, Jr., LeadDirector, and Alan W. Jebson, Chief Operating Officer of HSBC, are non-votingmembers of the Committee. The Board has determined that each of theseindividuals is financially literate. The Board of Directors has determined thatRobert K. Herdman qualifies as an audit committee financial expert. CODE OF ETHICS HSBC Finance Corporation's Board of Directors has adopted a Code of Ethics forSenior Financial Officers. That Code of Ethics is incorporated by reference inExhibit 14 to this Annual Report on Form 10-K. HSBC Finance Corporation also hasa general code of ethics applicable to all employees that is referred to as itsStatement of Business Principles and Code of Ethics. That document is availableon our website at www.hsbcusa.com or upon written request made to HSBC FinanceCorporation, 2700 Sanders Road, Prospect Heights, Illinois 60070, Attention:Corporate Secretary. SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE Section 16(a) of the Exchange Act, as amended, requires certain of ourDirectors, executive officers and any persons who own more than ten percent of aregistered class of our equity securities to report their initial ownership andany subsequent change to the SEC and the New York Stock Exchange ("NYSE"). Withrespect to the 6.36% Series B Preferred Stock of HSBC Finance Corporation, wereviewed copies of all reports furnished to us and obtained writtenrepresentations from our Directors and executive officers that no other reportswere required. Based solely on a review of copies of such forms furnished to usand written representations from the applicable Directors and executiveofficers, all Section 16(a) filing requirements were complied with for the 2005fiscal year. 195 ITEM 11. EXECUTIVE COMPENSATION.-------------------------------------------------------------------------------- EXECUTIVE COMPENSATION The following tables and narrative text discuss the compensation awarded to,earned by or paid to (i) Messrs. Aldinger and Mehta, who served as our ChiefExecutive Officer during 2005, and (ii) our four other most highly compensatedexecutive officers who were serving as executive officers as of December 31,2005. SUMMARY COMPENSATION TABLE LONG-TERM COMPENSATION ----------------------------------- AWARDS PAYOUTS ------------------------ -------- ANNUAL COMPENSATION NUMBER OF ----------------------------------------- RESTRICTED SHARESNAME AND OTHER ANNUAL STOCK UNDERLYING LTIPPRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION(1) RIGHTS(2) OPTIONS PAYOUTS-------------------------------------------------------------------------------------------------------------------Siddharth N. Mehta(4, 6)... 2005 $ 900,000 $3,000,000 $ 58,831 $10,999,992 - -Chairman & 2004 650,000 2,500,000 109,063 - 204,000 -Chief Executive Officer 2003 550,000 2,000,000 53,000 4,999,988 408,000 - William F. Aldinger III(5, 6)....................... 2005 $1,000,000 $ - $ 68,299 - - -Former Chairman & 2004 1,000,000 4,000,000 162,076 - - -Chief Executive Officer 2003 1,000,000 4,000,000 147,958 $ 9,999,986 - - Sandra L. Derickson(6)..... 2005 $ 700,000 $2,100,000 $ 11,298 $ 8,499,990 - -Vice Chairman 2004 600,000 1,800,000 14,158 - 102,000 - 2003 500,000 1,200,000 15,184 3,749,988 204,000 - Thomas M. Detelich......... 2005 $ 650,000 $1,800,000 $ 6,578 $ 5,499,998 - -Group Executive 2004 550,000 1,500,000 6,074 - 102,000 - 2003 500,000 650,000 2,481 3,749,998 204,000 - Walter G. Menezes.......... 2005 $ 600,000 $1,300,000 $ 2,444 $ 5,499,998 - -Group Executive 2004 500,000 1,000,000 3,755 - 150,000 - 2003 350,000 500,501 1,650 - 150,000 - Kenneth H. Robin(6)........ 2005 $ 600,000 $1,150,000 $ 18,591 $ 3,199,986 - -Senior EVP - 2004 400,000 1,000,000 23,923 - 102,000 -General Counsel & 2003 400,000 900,000 22,047 1,499,997 204,000 -Corporate Secretary NAME AND ALL OTHERPRINCIPAL POSITION COMPENSATION(3)--------------------------- ---------------Siddharth N. Mehta(4, 6)... $ 204,971Chairman & 160,568Chief Executive Officer 11,082,743William F. Aldinger III(5, 6)....................... $25,603,038Former Chairman & 310,062Chief Executive Officer 20,461,842Sandra L. Derickson(6)..... $ 155,151Vice Chairman 111,259 3,316,678Thomas M. Detelich......... $ 132,279Group Executive 74,340 2,531,871Walter G. Menezes.......... $ 109,582Group Executive 63,861 1,484,830Kenneth H. Robin(6)........ $ 105,601Senior EVP - 88,062General Counsel & 4,901,703Corporate Secretary --------------- (1) Other Annual Compensation includes items such as financial planning services, physical exams, club initiation fees, expatriate benefits, and car allowances. SEC rules require disclosure of the specific type and amount of compensation when a benefit exceeds 25% of the total Other Annual Compensation for an individual executive officer. That itemization follows: Car allowances for Mr. Aldinger were $15,000 in each of years 2003 and 2004 and $5,481 for 2005 and for Messrs. Mehta and Robin were $11,000 for each of 2003, 2004 and 2005 respectively. (Ms. Derickson and Messrs. Detelich and Menezes are not eligible for a car allowance). Personal use of aircraft for Mr. Aldinger for 2003, 2004 and 2005 was $110,678, $123,291 and $56,449 respectively. Mr. Aldinger, while Chairman of HSBC Finance Corporation was expressly directed by corporate policy to use our corporate aircraft to the fullest extent for business and personal travel; however, the value of personal aircraft use was reported as income. Club Initiation fees for Mr. Mehta for 2003 and 2004 were $40,000 and $20,000 respectively. Personal use of Corporate Apartment for Mr. Mehta in 2005 was $700, for Mr. Aldinger in 2003 was $2,880 and in 2004 was $1,020 and for Mr. Robin in 2003 was $540 and in 2004 was $1,020. Personal use of Corporate Limo for Mr. Mehta was $8,576 in 2005, for Mr. Aldinger $7,400 in 2003, $7,600 in 2004 and $2,191 in 2005 and for Mr. Robin $335 in 2005. Financial Counseling for Mr. Mehta was $4,000 in 2004 and $10,000 in 2005, for Mr. Aldinger $10,000 in each of years 2003 and 2004, for Ms. Derickson $4,000 in 2003 and $3,750 in 2004, for Mr. Detelich $481 in 2003, and $3,500 in each of 2004 and 2005, and for Mr. Robin $4,000 in each of 2003 and 2004 and $3,100 in 2005. Executive Physical expenses for Mr. Mehta was $1,671 in 2004 and $2,131 in 2005, for Mr. Aldinger $3,105 for 2004 and $2,079 for 2005, for Ms. Derickson $9,184 for 2003, $2,915 for 2004 and $9,198 for 2005, for Mr. Detelich $978 in 2005, for Mr. Menezes $1,650 in 2003, $1,695 in 2004 and $344 in 2005 and for Mr. Robin $4,507 in 2003, $2,408 in 2004 and $2,056 in 2005. All named executive officers received Executive Umbrella Liability Coverage in the amounts of $2,000 for 2003, $2,060 in 2004 and $2,100 in 2005. In 2004 and 2005 Mr. Mehta had $39,994 and $24,324 in relocation and moving expenses, including a tax gross up for the 2004 payment. (2) For 2003 this amount represents the dollar value of restricted shares issued to the named executive officers under the HSBC Holdings Restricted Share Plan 2000. The dollar value reflected in the table is based on the fair market value of the underlying HSBC Holdings plc ordinary shares on April 15, 2003 (the date of grant) converted into U.S. dollars using the exchange rate applied at the time of 196 grant. For Messrs. Aldinger and Robin the shares vest ratably over 3 years from the date of grant. For Messrs. Mehta and Detelich and Ms. Derickson the shares vest ratably over 5 years from the date of grant. For 2005, this amount represents the dollar value of the restricted shares issued to the named executive officers under the HSBC Share Plan. The named executive officers were awarded two separate grants in 2005. The dollar value reflected in the table is based on the fair market value of the underlying HSBC Holdings plc ordinary shares on March 31, 2005 (the date of grant) and on May 27, 2005 (the date of grant) and converted into U.S. dollars using the exchange rates applied at the time of grant. The March 31, 2005 grant is performance based and the shares will vest in whole or in part 3 years from the date of grant if all or some of the performance conditions are met as follows: 50% of the award is subject to a total shareholder return measure ("TRS") against a competitor group, depending on HSBC's ranking against the group at the end of the performance period, the TRS portion of the grant may vest on a sliding scale from 100% to 0%. The remaining 50% of the award is subject to an earning per share measure ("EPS") and the EPS portion of the grant may vest based on an incremental EPS percentage in accordance with a defined formula. If the aggregate incremental EPS is less than 24%, the EPS portion will be forfeited and if it is 52% or more, the EPS component will vest in full. The May 27, 2005 grant was a special grant made to 6 key executives to assist in retention and to reward outstanding performance and vests ratably over 5 years for each of Messrs. Mehta, Detelich and Menezes and Ms. Derickson and ratably over 2 years for Mr. Robin. These valuations do not take into account the diminution in value attributable to the restrictions applicable to the underlying shares. As of December 31, 2005, the total number of shares and values of the restricted shares held by the named executive officers were as follows: Mr. Mehta 977,057 shares ($15,683,978), Ms. Derickson 748,632 shares ($12,017,239), Mr. Detelich 559,239 shares ($8,977,053), Mr. Menezes 347,107 shares ($5,571,854) and Mr. Robin 250,148 shares ($4,015,442). Mr. Aldinger's restricted stock vested in full on the date of termination. The value of shares was calculated using a share price of GBP9.33 per share and a currency exchange rate of 1.7205. Dividend equivalents, in the form of additional shares, are paid on all underlying shares for restricted stock at the same rate as paid to ordinary share shareholders. (3) Includes life insurance premiums paid by HSBC Finance Corporation in 2003, 2004 and 2005 for the benefit of executives as follows: Mr. Mehta, $3,510, $3,645, $3,510; Mr. Aldinger, $10,062, $10,062, $3,870; Ms. Derickson, $4,727, $5,336, $5,382; Mr. Detelich, $2,318, $3,379, $3,510; Mr. Menezes, $6,611, $6,946, $13,813 and Mr. Robin, $10,062, $10,062, $10,062. Also includes HSBC Finance Corporation's contribution for the named executive officer's participation in the Tax Reduction Investment Plan and Supplemental Tax Reduction Investment Plan in 2003, 2004 and 2005 as follows: Mr. Mehta, $108,000, $156,923, $201,461; Mr. Aldinger, $180,000, $300,000, $616,923; Ms. Derickson, $90,000, $105,923, $149,769; Mr. Detelich, $69,000, $70,962, $128,769; Mr. Menezes, $42,000, $56,915, $95,769 and Mr. Robin, $66,000, $78,000, $95,539. For 2003, the remaining amounts represent parachute payments and accelerated vesting of restricted stock rights in connection with the change in control provisions contained in the named executive officers' employment agreements. Mr. Aldinger's 2005 compensation also includes payments made pursuant to his employment agreement under which he received a separation payment in the amount of $5,000,000 and accelerated vesting of all outstanding restricted stock. (4) Mr. Mehta assumed the role of Chairman and Chief Executive Officer of HSBC Finance Corporation on May 1, 2005. (5) Mr. Aldinger resigned as Chairman and Chief Executive Officer of HSBC Finance Corporation April 30, 2005. (6) Part of the compensation payable to these individuals includes compensation for services rendered to HSBC North America. INCENTIVE AND STOCK OPTION PLANS Pre-Merger Following HSBC's acquisition of HSBC Finance Corporation in 2003, alloutstanding options and other equity based awards approved under the HouseholdInternational 1996 Long-Term Executive Incentive Compensation Plan (the "1996Plan") and various option plans assumed by HSBC Finance Corporation inconnection with the mergers with Beneficial Corporation in 1998 and RenaissanceHoldings, Inc. in 2000 were converted into rights to receive HSBC Holdings plcordinary shares in the same ratio as the share exchange offer for theacquisition of HSBC Finance Corporation (2.675 HSBC Holdings plc ordinary sharesfor each HSBC Finance Corporation common share) and the exercise prices pershare were adjusted accordingly. All outstanding options granted prior to November 12, 2002 immediately vested oncompletion of the acquisition and remain exercisable through their respectiveexpiration dates. Options granted on or after November 13, 2002 but prior toMarch 28, 2003, the date of the completion of the merger, are exercisable ontheir original terms, subject to adjustment to reflect the exchange ratio. As of December 31, 2005, options to buy 35,251,439 shares of HSBC ordinary stockwere outstanding under the 1996 Plan and options to purchase 780,567 ordinaryshares were outstanding under the Beneficial Corporation and RenaissanceHoldings Inc. option plans. At the time of merger, HSBC established employeebenefit trusts to hold shares underlying the options. As of December 31, 2005,the HSBC (Household) Employee Benefit Trust 2003 held 3,006,623 HSBC ordinaryshares and 2,198,829 American Depository 197 Shares, each of which represents five HSBC ordinary shares, which may be used tosatisfy the exercise of employee stock options. The average purchase price for all outstanding options held by the 322participants in the 1996 Plan, Beneficial Corporation and Renaissance HoldingsInc. plans at December 31, 2005, was $16.09 with expiration dates from 2006 to2012. All outstanding restricted stock rights ("RSRs") granted prior to November 12,2002 immediately vested on completion of the merger. RSRs granted after November12, 2002 but prior to March 28, 2003 remain exercisable on their original terms,except that they have been adjusted to reflect the exchange ratio. A holder ofRSRs is not entitled to any of the rights of a holder of ordinary shares untilthe shares are issued; however, the Remuneration Committee (the "RemunerationCommittee") of HSBC Holdings plc may direct HSBC Finance Corporation to pay theholder cash equal to the cash dividends declared on ordinary shares for eachshare of stock subject to an RSR. As of December 31, 2005, 1,309,073 shares weresubject to issuance under outstanding RSR awards under the 1996 Plan. Theissuance of any underlying stock pursuant to vesting of RSRs will be newlyissued ordinary shares. The number of options, RSRs and underlying shares will be proportionatelyadjusted for any stock dividends, stock splits, consolidations orreclassifications. No further options or other equity based awards will begranted under any of the pre-merger plans. Post Merger Beginning March 28, 2003 but prior to May 27, 2005, options and other equitybased awards were made to HSBC Finance Corporation employees under the HSBCHoldings Group Share Option Plan ("Group Share Option Plan") and the HSBCRestricted Share Plan 2000 ("Restricted Share Plan"). Under both the Group ShareOption Plan and the Restricted Share Plan, the Remuneration Committee has thediscretion to grant employees awards of stock options or restricted shares withor without company performance conditions. Generally option and RSR awardsgranted in 2003 were granted without any company performance conditions andoptions and RSR awards granted in 2004 were granted subject to performanceconditions to better align the HSBC Finance Corporation employees with theinterests of HSBC. Both the Group Share Option Plan and the Restricted SharePlan terminated in May 2005 and no further awards may be made under either ofthese plans. The number of options, RSRs and underlying shares will beproportionately adjusted for any stock dividends, stock splits, consolidationsor reclassifications. In May 2005, the HSBC Holdings plc Board of Directors adopted and theshareholders approved the HSBC Share Plan ("Group Share Plan"). The RemunerationCommittee at its discretion may make awards of restricted shares andmarket-price options, each with or without performance conditions. For 2005, asan incentive and a retention tool, HSBC awarded restricted shares to middlemanagement and performance shares to executive management. The restricted sharesgenerally vest in full 3 years after the date of grant and the performanceshares will vest in full or in part 3 years after the date of grant if certaincompany performance conditions are met. A holder of restricted shares orperformance shares is not entitled to any of the rights of a holder of ordinaryshares until the shares are issued; however, the Remuneration Committee maydirect the trustee of the employee benefit trusts to record a share baseddividend equivalent to the cash dividends declared on ordinary shares for eachshare of stock subject to a restricted share. As of December 31, 2005, employees of HSBC Finance Corporation held options tobuy 6,175,800 shares of HSBC ordinary stock under the Group Share Option Planand RSRs representing 11,787,706 under the Restricted Share Plan and the GroupShare Plan. The average purchase price for all outstanding options held by the participantsunder the Group Share Option Plan at December 31, 2005 was $14.96 withexpiration dates from 2013-2014. HSBC Finance Corporation did not issue stock options to its named executiveofficers in 2005. 198 The following table shows that the named executive officers did not exercise anystock options in 2005. The table also shows the number of options that have notbeen exercised and their potential value using the fair market value on December31, 2005. The fair market value has been converted from British Pounds Sterlingto U.S. dollars using an exchange rate of 1.7205. AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES NUMBER OF SHARES VALUE OF UNEXERCISED UNDERLYING IN-THE-MONEY UNEXERCISED OPTIONS AT OPTIONS AT DECEMBER 31, 2005 DECEMBER 31, 2005(1) SHARES VALUE --------------------------- ---------------------------NAME EXERCISED REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE-----------------------------------------------------------------------------------------------------------Siddharth N. Mehta....... - $- 3,034,150 541,750 $ 1,122,367 $1,088,113William F. Aldinger III.................... - - 9,656,750 - 16,409,788 -Sandra L. Derickson...... - - 543,375 270,875 1,115,029 544,056Thomas M. Detelich....... - - 576,813 270,875 1,240,219 490,028Walter G. Menezes........ - - 500,325 251,750 639,786 438,933Kenneth H. Robin......... - - 1,364,600 270,875 2,323,273 577,716 --------------- (1) Calculated based on the fair market value of HSBC Holdings plc. ordinary shares on December 31, 2005 (L9.33 per share). SAVINGS AND PENSION PLANS HSBC North America maintains the HSBC-North America (U.S.) Tax ReductionInvestment Plan ("TRIP"), which is a deferred profit-sharing and savings planfor its eligible employees. With certain exceptions, a U.S. employee who hasbeen employed for 30 days and who is not part of a collective bargaining unitmay contribute into TRIP, on a pre-tax and after-tax basis, up to 40% (15% ifhighly compensated) of the participant's cash compensation (subject to a maximumannual pre-tax contribution by a participant of $15,000, as adjusted for cost ofliving increases, and certain other limitations imposed by the Internal RevenueCode) and invest such contributions in separate equity or income funds. If the employee has been employed for at least one year, HSBC FinanceCorporation contributes 3% of compensation on behalf of each participant whocontributes 1% and matches any additional participant contributions up to 4% ofcompensation. However, matching contributions will not exceed 6% of aparticipant's compensation if the participant contributes 4% or more ofcompensation. The plan provides for immediate vesting of all contributions. Withcertain exceptions, a participant's after-tax contributions which have not beenmatched by us can be withdrawn at any time. Both our matching contributions madeprior to 1999 and the participant's after-tax contributions which have beenmatched may be withdrawn after five years of participation in the plan. Aparticipant's pre-tax contributions and our matching contributions after 1998may not be withdrawn except for an immediate financial hardship, upontermination of employment, or after attaining age 59 1/2. Participants mayborrow from their TRIP accounts under certain circumstances. HSBC North America also maintains the Supplemental Tax Reduction Investment Plan("Supplemental TRIP") which is an unfunded plan for eligible employees of HSBCFinance Corporation and its participating subsidiaries prior to the merger withHSBC whose participation in TRIP is limited by the Internal Revenue Code. Onlymatching contributions required to be made by us pursuant to the basic TRIPformula are invested in Supplemental TRIP through a credit to a bookkeepingaccount maintained by us which deems such contributions to be invested in equityor income funds selected by the participant. The HSBC-North America (U.S.) Retirement Income Plan ("RIP") is anon-contributory, defined benefit pension plan for employees of HSBC NorthAmerica and its U.S. subsidiaries who are at least 21 years of age with one yearof service and not part of a collective bargaining unit. RIP contains planformulas for pre-merger Household employees as well as a cash balance formulafor hires after 1999. Under the pre-merger Household 199 formula, annual pension benefits equal a percentage of an employee's "FinalAverage Salary" (as defined below) not in excess of "Covered Compensation" (asdefined below) plus a percentage of an employee's Final Average Salary thatexceeds Covered Compensation. "Covered Compensation" is the average of theSocial Security taxable wage base over the 35-year period ending in the year ofretirement or earlier termination of employment. "Final Average Salary" equalsthe average of salary plus bonus for the 48 successive highest paid months outof the employee's last 10 years of service. The percentage applied to FinalAverage Salary and Covered Compensation is determined on the basis of years ofemployment and age at retirement. This percentage increases as years ofemployment and age at retirement increase. Participants become fully vested intheir accrued pension benefits after three years of vesting service. Payment ofvested pension benefits normally begins at age 65, but an early retirementbenefit at reduced levels may be paid if a participant is at least 55 years ofage with 10 years of employment or, if the participant was an employee onDecember 31, 1989, is at least 50 years of age with 15 years of employment. Effective January 1, 2000, RIP was amended to provide a cash balanceaccount-based formula instead of the traditional defined benefit formuladescribed above for employees hired after 1999. The account-based formulaprovides a benefit based upon a percentage of compensation for each year ofservice and an assumed rate of return. The contribution percentage is 2% and theassumed rate of return is tied to the lesser of the 10-year or 30-year Treasuryrate. Effective January 1, 2005, RIP was amended to reflect the merger of theHSBC Bank USA Pension Plan into RIP and the continuance of that plan formula forparticipants transferred to RIP. In 1997, HSBC Finance Corporation's Board of Directors adopted a SupplementalExecutive Retirement Plan ("SERP") for Mr. Aldinger because he would nototherwise qualify for a full benefit under RIP and the Household SupplementalRetirement Income Plan ("Supplemental RIP") due to his age when he joined HSBCFinance Corporation. In 2000, the SERP was subsequently amended and restated toprovide for a benefit based upon the RIP 1989 formula but with 20 years ofbenefit service being added and with an offset not only for RIP and SupplementalRIP but also for pension benefits received from Wells Fargo and Citibank. Thebenefit under the SERP formula (before offset) will not be increased, however,except for interest, after Mr. Aldinger attains age 60. Upon the change ofcontrol triggered by the purchase of HSBC Finance Corporation by HSBC, thepension benefit for Mr. Aldinger was projected out for three years and thenaccruals ceased. TRIP and RIP may be made available to members of a collective bargaining unit ifinclusion results from good faith bargaining. A portion of the benefits payable under RIP to certain executive officers(including those named in the Summary Compensation Table) may be paid by usthrough the Supplemental RIP. Supplemental RIP was established due to thelimitation imposed on the RIP by Federal laws limiting benefits payable undertax-qualified plans. The following table illustrates the amount of RIP (including Supplemental RIP)total annual pension benefits on a straight-life annuity basis for eligibleemployees retiring at age 65 who were employed before 1990. If the employee washired after 1989 and does not have at least 30 years of employment atretirement, his/her benefit will be reduced for each month less than 30 years.The amounts in this table are not subject to 200 deduction for Social Security or other offset amounts and do not reflect anylimitations on benefits imposed by ERISA or Federal tax laws. Ms. Derickson iscovered under the cash balance account based formula. The years of employment of Messrs. Detelich, Robin, Aldinger, Menezes, Mehta andMs. Derickson for purposes of RIP are, respectively, 30 years, 17 years, 12years, 10 years, 8 years, and 6 years. AVERAGE ANNUALCOMPENSATIONUSED AS BASIS FOR 15 TO 30 YEARS OF 35 YEARS OF 40 OR MORE YEARS OFCOMPUTING PENSIONS EMPLOYMENT EMPLOYMENT EMPLOYMENT-------------------------------------------------------------------------------------------------------$1,500,000..................................... $ 852,071 $ 889,571 $ 927,0712,000,000...................................... 1,137,071 1,187,071 1,237,0712,500,000...................................... 1,422,071 1,484,571 1,547,0713,000,000...................................... 1,707,071 1,782,071 1,857,0713,500,000...................................... 1,992,071 2,079,571 2,167,0714,000,000...................................... 2,277,071 2,377,071 2,477,0714,500,000...................................... 2,562,071 2,674,571 2,787,0715,000,000...................................... 2,847,071 2,972,071 3,097,0715,500,000...................................... 3,132,071 3,269,571 3,407,0716,000,000...................................... 3,417,071 3,567,071 3,717,071 DIRECTOR COMPENSATION In 2005, the non-management Directors of HSBC Finance Corporation received anannual cash retainer of $170,000 (except the Chair of the Executive Committee,who received a retainer of $182,000). HSBC Finance Corporation does not payadditional compensation for committee membership, with the exception of theAudit Committee for which each member received an additional $15,000 (except theChair of the Audit Committee, who instead received an additional $25,000), ormeeting attendance fees to its Directors. The Chairs of the Compensation andNominating & Governance Committees received an additional $15,000, and the LeadDirector as Chair of the Executive Committee received an additional $50,000.Directors who are employees of HSBC Finance Corporation or any of itssubsidiaries do not receive any additional compensation related to their Boardservice. In February 2006, the Board reviewed its directors compensationphilosophy compared to other same sized financial and professional serviceorganizations and determined to make no changes to the current compensationstructure. Directors have the ability to defer up to 100% of their yearly retainers and/orfees into the HSBC-North America Directors Non-Qualified Deferred CompensationPlan. Under this plan, Directors have the ability to defer pre-tax dollars withthe choice of a scheduled in-service withdrawal or distribution at terminationwith lump sum, quarterly or annual installments. We provide each Director with $250,000 of accidental death and dismembermentinsurance and a $10,000,000 personal excess liability insurance policy.Independent Directors also are offered, on terms that are not more favorablethan those available to the general public, a MasterCard/Visa credit card issuedby one of our subsidiaries with a credit limit of $15,000. HSBC FinanceCorporation guarantees the repayment of amounts charged on each card. Directorsmay use an apartment we maintain in New York City for their personal use, asavailable. Directors are credited with $340 additional compensation for taxpurposes for each night the apartment is used for personal use. Under HSBC Finance Corporation's Matching Gift Program, we match charitablegifts to qualified organizations (subject to a maximum of $10,000 per year),with a double match for the first $500 donated to higher education institutions(both public and private) and eligible non-profit organizations which promoteneighborhood revitalization or economic development for low and moderate incomepopulations. Each current independent Director may ask us to contribute up to$10,000 annually to charities of the Director's choice which qualify under ourphilanthropic program. 201 Prior to the merger, independent Directors could elect to receive all or aportion of their cash compensation in shares of former Household common stock,defer it under the Deferred Fee Plan for Directors or purchase options toacquire common stock. Under the Deferred Fee Plan, Directors were permitted toinvest their deferred compensation in either units of phantom shares of theformer Household common stock, with dividends credited toward additional stockunits, or cash, with interest credited at a market rate set under the plan. Prior to 1995, HSBC Finance Corporation had a Directors' Retirement Income Planwhere the present value of each Director's accrued benefit was deposited intothe Deferred Phantom Stock Plan for Directors. Under the Deferred Phantom StockPlan, Directors with less than ten years of service received 750 phantom sharesof former Household common stock annually during the first ten years of serviceas a Director. In January 1997, the Board eliminated this and all futureDirector retirement benefits. Any payouts to current Directors earned under theDeferred Phantom Stock Plan will be made only when a Director leaves the Boarddue to death, retirement or resignation and were to be paid in shares ofHousehold common stock either in a lump sum or installments as selected by theDirector. Following the acquisition, all rights to receive Household common stock underboth plans above were converted into rights to receive HSBC Holdings plcordinary shares and in May 2004, those rights were further converted into rightsto receive American Depository Shares, each of which represents five ordinaryshares, when the plans were rolled into a non-qualified deferred compensationplan for Directors. No new shares may be issued under the plans. As of December31, 2005, 56,459 American Depository Shares were held in the deferredcompensation plan account for Directors. EMPLOYMENT AGREEMENTS Upon completion of the merger with HSBC, Messrs. Detelich, Mehta and Robin andMs. Derickson received new employment agreements that, except as noted belowwith respect to Mr. Mehta and Ms. Derickson, will end on March 28, 2006. Underthe new employment agreements, each executive will generally serve in the sameposition that such executive held as of the date of the merger. During the term,each executive will be paid an annual base salary of not less than suchexecutive's annual base salary as of the date of the merger and will receive anannual bonus in an amount at least equal to 75 percent of the annual average ofsuch executive's bonuses earned with respect to the three-year period endedDecember 31, 2001 (pro rated for any partial year). During the term of theagreements, each of the executives will be eligible to participate, as approvedby the HSBC Board of Directors, in any equity-based incentive compensation planor program of HSBC as in effect from time to time for similarly situated seniorexecutives of HSBC Finance Corporation. In addition, during the term, eachexecutive will be eligible to participate in the various retirement, medical,disability and life insurance plans, programs and arrangements of HSBC FinanceCorporation in accordance with the terms of such plans, programs andarrangements, provided that they will not receive age and service credit underthe HSBC North America retirement plans that would be duplicative of the age andservice credit that they are entitled to under the prior employment agreementsor employment protection agreements, as applicable. If during the term of the new employment agreement, an executive's employment isterminated by HSBC Finance Corporation other than for "cause" or disability orthe executive resigns for "good reason," subject to the executive's execution ofa general release in favor of HSBC Finance Corporation and its affiliates, theexecutive will continue to receive the executive's base salary and annual bonusdescribed above at that time and in the manner such payments would have beenpaid had the executive remained employed for the remainder of the term of theemployment agreement and, to the extent permitted under the terms of theapplicable plans, the continuation of welfare benefits, umbrella liabilityinsurance and automobile and financial counseling allowances from the date oftermination until the earlier of the executive becoming eligible to participatein similar plans of another employer and the last day of the term of theemployment agreement. These new employment agreements superseded each executive's prior employmentagreement or employment protection agreement, as applicable, with HSBC FinanceCorporation (except that the excise tax gross-up 202 provision in the pre-merger agreements survived). At the merger with HSBC,Messrs. Aldinger, Detelich, Mehta and Robin and Ms. Derickson had employment oremployment protection agreements that were deemed to have terminated due to a"qualifying termination," entitling the executives to cash payments under theprior agreements. Payments were made to those executives under the formuladescribed below under "Employment Protection Agreement of Mr. Menezes" exceptthat for Messrs. Aldinger, Mehta and Robin the protection period was based on 36months instead of 18 and there was no reduction in payments to avoid an excisetax. The contracts for Sandra L. Derickson and Siddharth N. Mehta were extended bytwo years and now will expire as of March 28, 2008. Under Mr. Mehta's extendedcontract, he will serve as Chairman and Chief Executive Officer of HSBC FinanceCorporation and also Chief Executive Officer of HSBC North America Holdings Inc.His base salary was increased to $900,000. The annual bonus for Mr. Mehta andfor Ms. Derickson with respect to each fiscal year after 2005 shall be at leastequal to 75 percent of the annual average of the bonuses earned by each of themwith respect to fiscal years 2003, 2004 and 2005 (pro rated for any partialyear). Mr. Mehta and Ms. Derickson were also awarded in 2005 one-time specialretention grants of HSBC restricted shares equal to $8 million and $6 million,respectively, based on the closing price of HSBC ordinary shares as of the dateof the grant. These shares will vest in five equal installments on each of thefirst five anniversaries of March 26, 2005, subject to accelerated vesting upontermination of employment by HSBC Finance Corporation without cause, or by Mr.Mehta or Ms. Derickson, in each case, for good reason. EMPLOYMENT PROTECTION AGREEMENT OF MR. MENEZES Mr. Menezes, has an employment protection agreement pursuant to which if, duringthe 18 month period following a change in control of HSBC Finance Corporation,Mr. Menezes' employment is terminated due to a "qualifying termination" (whichincludes a termination other than for "cause" or disability, or resignation byMr. Menezes for "good reason"), he will be entitled to receive a cash paymentconsisting of: - A pro rata annual bonus through the date of termination, based on the highest of the annual bonuses payable during the three years preceding the year in which the termination occurs; - A payment equal to 1.5 times the sum of the applicable base salary and highest annual bonus; and - A payment equal to the value of 18 months of additional employer contributions under HSBC North America's tax-qualified and supplemental defined contribution plans. In addition, upon a qualifying termination following a change in control, Mr.Menezes will be entitled to continued welfare benefit coverage for 18 monthsafter the date of termination, 18 months of additional age and service creditunder HSBC North America's tax-qualified and supplemental defined benefitretirement plans, and outplacement services. If any amounts or benefits receivedunder the employment protection agreements or otherwise are subject to theexcise tax imposed under section 4999 of the Internal Revenue Code, anadditional payment will be made to restore Mr. Menezes to the after-tax positionin which he would have been if the excise tax had not been imposed. However, ifa small reduction in the amount payable would render the excise taxinapplicable, then this reduction will be made instead. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT ANDRELATED STOCKHOLDER MATTERS.-------------------------------------------------------------------------------- SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS HSBC Finance Corporation's common stock is 100% owned by HSBC Investments (NorthAmerica) Inc. ("HINO"). HINO is an indirect wholly owned subsidiary of HSBC. 203 SECURITY OWNERSHIP BY MANAGEMENT The following table lists the beneficial ownership, as of January 31, 2006, ofHSBC ordinary shares or interests in ordinary shares and Series B PreferredStock of HSBC Finance Corporation by each director and the executive officersnamed in the Summary Compensation Table on page 196, individually, and thedirectors and executive officers as a group. Each of the individuals listedbelow and all directors and executive officers as a group own less than 1% ofthe ordinary shares of HSBC and the Series B Preferred Stock of HSBC FinanceCorporation. NUMBER OF SERIES B SHARES THAT MAY SHARES PREFERRED OF BE ACQUIRED BENEFICIALLY HSBC WITHIN 60 DAYS NUMBER OF OWNED OF HSBC FINANCE BY EXERCISE OF COMMON STOCK HOLDINGS PLC(1)(2) CORPORATION OPTIONS(3) EQUIVALENTS(4) TOTAL--------------------------------------------------------------------------------------------------------------------DIRECTORSWilliam R. P. Dalton......... 118,508 - - - 118,508Gary G. Dillon............... 210,587 - 131,076 37,890 379,553J. Dudley Fishburn........... 15,678 - 90,950 4,050 110,678Cyrus F. Freidheim, Jr. ..... 15,755 - 151,264 21,347 188,366Robert K. Herdman............ - - - - -Alan W. Jebson............... 109,032 - - 180,491 289,523George A. Lorch.............. 13,605 - 145,789 30,190 189,584Siddharth N. Mehta........... 277,838 - 3,034,150 61,172 3,373,160Larree M. Renda.............. 8,250 2,000 40,125 130 50,505NAMED EXECUTIVE OFFICERSWilliam F. Aldinger III...... - - 9,656,750 - 9,656,750Sandra L. Derickson.......... 129,820 - 543,375 27,474 700,669Thomas M. Detelich........... 4,000 - 576,813 4,134 584,947Walter G. Menezes............ 109,370 - 522,616 - 631,986Kenneth H. Robin............. 335,990 - 1,364,000 68,508 1,768,498ALL DIRECTORS AND EXECUTIVE OFFICERS AS A GROUP........ 1,348,433 2,000 16,256,908 435,386 18,042,727 --------------- (1) Directors and executive officers have sole voting and investment power over the shares listed above, except as follows. The number of ordinary shares held by spouses, children and charitable or family foundations in which voting and investment power is shared (or presumed to be shared) is as follows: Mr. Dalton, 56,019 and Mr. Lorch, 13,650; and Directors and executive officers as a group, 69,669. (2) Some of the shares included in the table above were held in American Depository Shares, each of which represents five HSBC ordinary shares. (3) Represents the number of ordinary shares which may be acquired by HSBC Finance Corporation's Directors and executive officers through April 1, 2006, pursuant to the exercise of stock options. (4) Represents the number of ordinary share equivalents owned by executive officers under HSBC Finance Corporation's TRIP and HSBC North America Employee Non-Qualified Deferred Compensation Plan and by Directors under HSBC North America Directors Non-Qualified Deferred Compensation Plan. Some of the shares included in the table above were held in American Depository Shares, each of which represents five HSBC ordinary shares. 204 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.-------------------------------------------------------------------------------- None. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.-------------------------------------------------------------------------------- AUDIT FEES. The aggregate amount billed by our principal accountant, KPMG LLP,for audit services performed during the fiscal years ended December 31, 2005 and2004 was $6,785,000 and $5,565,000, respectively. Audit services include theauditing of financial statements, quarterly reviews, statutory audits, and thepreparation of comfort letters, consents and review of registration statements. AUDIT RELATED FEES. The aggregate amount billed by KPMG LLP in connection withaudit related services performed during the fiscal years ended December 31, 2005and 2004 was $1,272,000 and $691,000, respectively. Audit related servicesinclude employee benefit plan audits, translation services, and audit orattestation services not required by statute or regulation. TAX FEES. Total fees billed by KPMG LLP for tax related services for the fiscalyears ended December 31, 2005 and 2004 were $658,000 and $2,656,000,respectively. These services include tax related research, general tax servicesin connection with transactions and legislation and tax services for review ofFederal and state tax accounts for possible overassessment of interest and/orpenalties. ALL OTHER. Other than those fees described above, there were no other feesbilled for services performed by KPMG LLP during the fiscal years ended December31, 2005 and December 31, 2004. All of the fees described above were approved by HSBC Finance Corporation'saudit committee. AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES. HSBC Finance Corporation'saudit committee pre-approves the audit and non-audit services performed by KPMGLLP, our principal accountants, in order to assure that the provision of suchservices does not impair KPMG LLP's independence. Unless a type of service to beprovided by KPMG LLP has received general pre-approval, it will require specificpre-approval by the audit committee. In addition, any proposed servicesexceeding pre-approval cost levels will require specific pre-approval by theaudit committee. The term of any pre-approval is 12 months from the date of pre-approval, unlessthe audit committee specifically provides for a different period. The auditcommittee will periodically revise the list of pre-approved services, based onsubsequent determinations, and has delegated pre-approval authority to the Chairof the audit committee. In the event the Chair of the audit committee exercisessuch delegated authority, he will report such pre-approval decisions to theaudit committee at its next scheduled meeting. The audit committee does notdelegate its responsibilities to pre-approve services performed by theindependent auditor to management. PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.-------------------------------------------------------------------------------- (a)(1) Financial Statements. The consolidated financial statements listed below, together with an opinion ofKPMG LLP dated March 6, 2006 with respect thereto, are included in this Form10-K pursuant to Item 8. Financial Statements and Supplementary Data of thisForm 10-K. HSBC FINANCE CORPORATION AND SUBSIDIARIES: Report of Independent Registered Public Accounting Firm Consolidated Statement of Income Consolidated Balance Sheet Consolidated Statement of Cash Flows Consolidated Statement of Changes in Shareholder's(s') Equity Notes to Consolidated Financial Statements 205 Selected Quarterly Financial Data (Unaudited) (a)(2) Not applicable (a)(3) Exhibits. 3(i) Amended and Restated Certificate of Incorporation of HSBC Finance Corporation effective as of December 15, 2004, as amended (incorporated by reference to Exhibit 3.1 of HSBC Finance Corporation's Current Report on Form 8-K filed June 22, 2005 and Exhibit 3.1(b) of HSBC Finance Corporation's Current Report on Form 8-K filed December 19, 2005). 3(ii) Bylaws of HSBC Finance Corporation, as amended December 15, 2004 (incorporated by reference to Exhibit 3(ii) of HSBC Finance Corporation's Annual Report on Form 10-K for the year ended December 31, 2004 filed February 28, 2005). 4.1 Amended and Restated Standard Multiple-Series Indenture Provisions for Senior Debt Securities of HSBC Finance Corporation dated as of December 15, 2004 (incorporated by reference to Exhibit 4.1 of Amendment No. 1 to HSBC Finance Corporation's Registration Statements on Form S-3 Nos. 333-120494, 333-120495 and 333-120496 filed December 16, 2004). 4.2* Amended and Restated Indenture for Senior Debt Securities dated as of December 15, 2004 between HSBC Finance Corporation and JPMorgan Chase Bank, N.A., as Trustee (incorporated by reference to Exhibit 4.2 of Amendment No. 1 to HSBC Finance Corporation's Registration Statements on Form S-3 Nos. 333-120495 and 333-120496 filed December 16, 2004). 4.3 The principal amount of debt outstanding under each other instrument defining the rights of Holders of our long-term senior and senior subordinated debt does not exceed 10 percent of our total assets. HSBC Finance Corporation agrees to furnish to the Securities and Exchange Commission, upon request, a copy of each instrument defining the rights of holders of our long-term senior and senior subordinated debt. 12 Statement of Computation of Ratio of Earnings to Fixed Charges and to Combined Fixed Charges and Preferred Stock Dividends. 14 Code of Ethics for Senior Financial Officers (incorporated by reference to Exhibit 14 of HSBC Finance Corporation's Annual Report on Form 10-K for the year ended December 31, 2004 filed February 28, 2005). 21 Subsidiaries of HSBC Finance Corporation. 23 Consent of KPMG LLP, Independent Registered Public Accounting Firm. 24 Power of Attorney (included on page 207 of this Form 10-K). 31 Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32 Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 99.1 Ratings of HSBC Finance Corporation and its significant subsidiaries. Upon receiving a written request, we will furnish copies of the exhibitsreferred to above free of charge. Requests should be made to HSBC FinanceCorporation, 2700 Sanders Road, Prospect Heights, Illinois 60070, Attention:Corporate Secretary.--------------- * Substantially identical indentures exist with U.S. Bank National Association, BNY Midwest Trust Company and JPMorgan Trust Company, National Association. 206 SIGNATURES-------------------------------------------------------------------------------- Pursuant to the requirements of Section 13 or 15(d) of the Securities ExchangeAct of 1934, HSBC Finance Corporation has duly caused this report to be signedon its behalf by the undersigned, thereunto duly authorized on this, the 6th dayof March, 2006. HSBC FINANCE CORPORATION By: /s/ Siddharth N. Mehta ------------------------------------ Siddharth N. Mehta Chairman and Chief Executive Officer Each person whose signature appears below constitutes and appoints P.D. Schwartzas his/her true and lawful attorney-in-fact and agent, with full power ofsubstitution and resubstitution, for him/her in his/her name, place and stead,in any and all capacities, to sign and file, with the Securities and ExchangeCommission, this Form 10-K and any and all amendments and exhibits thereto, andall documents in connection therewith, granting unto each such attorney-in-factand agent full power and authority to do and perform each and every act andthing requisite and necessary to be done, as fully to all intents and purposesas he/she might or could do in person, hereby ratifying and confirming all thatsuch attorney-in-fact and agent or their substitutes may lawfully do or cause tobe done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this reporthas been signed below by the following persons on behalf of HSBC FinanceCorporation and in the capacities indicated on the 6th day of March, 2006. SIGNATURE TITLE-------------------------------------------------------------------------------------------------------- /s/ S. N. MEHTA Chairman and Chief Executive Officer and ------------------------------------------------------ Director (as Principal Executive Officer) (S. N. Mehta) /s/ W. R. P. DALTON Director ------------------------------------------------------ (W. R. P. Dalton) /s/ G. G. DILLON Director ------------------------------------------------------ (G. G. Dillon) /s/ J. D. FISHBURN Director ------------------------------------------------------ (J. D. Fishburn) /s/ C. F. FREIDHEIM, JR. Director ------------------------------------------------------ (C. F. Freidheim, Jr.) /s/ R. K. HERDMAN Director ------------------------------------------------------ (R. K. Herdman) /s/ A. W. JEBSON Director ------------------------------------------------------ (A. W. Jebson) /s/ G. A. LORCH Director ------------------------------------------------------ (G. A. Lorch) 207 SIGNATURE TITLE-------------------------------------------------------------------------------------------------------- /s/ L. M. RENDA Director ------------------------------------------------------ (L. M. Renda) /s/ B. A. SIBBLIES Senior Vice President and Chief Financial ------------------------------------------------------ Officer (B. A. Sibblies) /s/ J. E. BINYON Vice President and Chief Accounting Officer ------------------------------------------------------ (J. E. Binyon) 208 EXHIBIT INDEX-------------------------------------------------------------------------------- 3(i) Amended and Restated Certificate of Incorporation of HSBC Finance Corporation effective as of December 15, 2004, as amended (incorporated by reference to Exhibit 3.1 of HSBC Finance Corporation's Current Report on Form 8-K filed June 22, 2005 and Exhibit 3.1(b) of HSBC Finance Corporation's Current Report on Form 8-K filed December 19, 2005). 3(ii) Bylaws of HSBC Finance Corporation, as amended December 15, 2004 (incorporated by reference to Exhibit 3(ii) of HSBC Finance Corporation's Annual Report on Form 10-K for the year ended December 31, 2004 filed February 28, 2005). 4.1 Amended and Restated Standard Multiple-Series Indenture Provisions for Senior Debt Securities of HSBC Finance Corporation dated as of December 15, 2004 (incorporated by reference to Exhibit 4.1 of Amendment No. 1 to HSBC Finance Corporation's Registration Statements on Form S-3 Nos. 333-120494, 333-120495 and 333-120496 filed December 16, 2004). 4.2* Amended and Restated Indenture for Senior Debt Securities dated as of December 15, 2004 between HSBC Finance Corporation and JPMorgan Chase Bank, N.A., as Trustee (incorporated by reference to Exhibit 4.2 of Amendment No. 1 to HSBC Finance Corporation's Registration Statements on Form S-3 Nos. 333-120495 and 333-120496 filed December 16, 2004). 4.3 The principal amount of debt outstanding under each other instrument defining the rights of Holders of our long-term senior and senior subordinated debt does not exceed 10 percent of our total assets. HSBC Finance Corporation agrees to furnish to the Securities and Exchange Commission, upon request, a copy of each instrument defining the rights of holders of our long-term senior and senior subordinated debt. 12 Statement of Computation of Ratio of Earnings to Fixed Charges and to Combined Fixed Charges and Preferred Stock Dividends. 14 Code of Ethics for Senior Financial Officers (incorporated by reference to Exhibit 14 of HSBC Finance Corporation's Annual Report on Form 10-K for the year ended December 31, 2004 filed February 28, 2005). 21 Subsidiaries of HSBC Finance Corporation. 23 Consent of KPMG LLP, Independent Registered Public Accounting Firm. 24 Power of Attorney (included on page 207 of this Form 10-K). 31 Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32 Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 99.1 Ratings of HSBC Finance Corporation and its significant subsidiaries. --------------- * Substantially identical indentures exist with U.S. Bank National Association, BNY Midwest Trust Company and JPMorgan Trust Company, National Association. EXHIBIT 12 HSBC FINANCE CORPORATION COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS MARCH 29 JANUARY 1 YEAR ENDED YEAR ENDED THROUGH THROUGH DECEMBER 31, DECEMBER 31, DECEMBER 31, MARCH 28, 2005 2004 2003 2003 2002 2001------------------------------------------------------------------------------------------------------------------------ (SUCCESSOR) (SUCCESSOR) (SUCCESSOR) (PREDECESSOR) (PREDECESSOR) (PREDECESSOR) (IN MILLIONS)Net income..................... $1,772 $1,940 $1,357 $ 246 $1,558 $1,848Income taxes................... 891 1,000 690 182 695 970 ------ ------ ------ ------ ------ ------Income before income taxes..... 2,663 2,940 2,047 428 2,253 2,818 ------ ------ ------ ------ ------ ------Fixed charges: Interest expense(1).......... 4,832 3,143 2,031 898 3,879 4,197 Interest portion of rentals(2)................. 61 54 40 18 68 64 ------ ------ ------ ------ ------ ------Total fixed charges............ 4,893 3,197 2,071 916 3,947 4,261 ------ ------ ------ ------ ------ ------Total earnings as defined...... $7,556 $6,137 $4,118 $1,344 $6,200 $7,079Ratio of earnings to fixed charges...................... 1.54 1.92(4) 1.99 1.47(5) 1.57(6) 1.66 ====== ====== ====== ====== ====== ======Preferred stock dividends(3)... 125 108 86 32 91 24 ====== ====== ====== ====== ====== ======Ratio of earnings to combined fixed charges and preferred stock dividends.............. 1.51 1.86(4) 1.91 1.42(5) 1.54(6) 1.65 ====== ====== ====== ====== ====== ====== --------------- (1) For financial statement purposes, these amounts are reduced for income earned on temporary investment of excess funds, generally resulting from over-subscriptions of commercial paper issuances. (2) Represents one-third of rentals, which approximates the portion representing interest. (3) Preferred stock dividends are grossed up to their pretax equivalents. (4) The 2004 ratios have been negatively impacted by $121 million (after-tax) from the adoption of FFIEC charge-off policies for our domestic private label (excluding retail sales contracts at our consumer lending business) and MasterCard and Visa portfolios in December 2004 and positively impacted by the $423 million (after-tax) gain on the bulk sale of our domestic private label receivables (excluding retail sales contracts at our consumer lending business) to HSBC Bank USA in December 2004. Excluding these items, our ratio of earnings to fixed charges would have been 1.83 percent and our ratio of earnings to combined fixed charges and preferred stock dividends would have been 1.77 percent. These non-GAAP financial ratios are provided for comparison of our operating trends only. (5) The 2003 ratios have been negatively impacted by the $167 million (after-tax) of HSBC acquisition related costs and other merger related items incurred by HSBC Finance Corporation. Excluding these charges, our ratio of earnings to fixed charges would have been 1.69 percent and our ratio of earnings to combined fixed charges and preferred stock dividends would have been 1.63 percent. These non-GAAP financial ratios are provided for comparison of our operating trends only. (6) The 2002 ratios have been negatively impacted by the $333 million (after-tax) settlement charge and related expenses and the $240 million (after-tax) loss on the disposition of Thrift assets and deposits. Excluding these charges, our ratio of earnings to fixed charges would have been 1.80 percent and our ratio of earnings to combined fixed charges and preferred stock dividends would have been 1.76 percent. These non-GAAP financial ratios are provided for comparison of our operating trends only. EXHIBIT 21 SUBSIDIARIES OF HSBC FINANCE CORPORATION US -- STATENAMES OF SUBSIDIARIES ORGANIZED--------------------- --------------AHLIC Investment Holdings Corporation....................... DelawareB.I.G. Insurance Agency, Inc. .............................. OhioBeaver Valley, Inc. ........................................ DelawareBencharge Credit Service Holding Company.................... DelawareBeneficial Alabama Inc. .................................... AlabamaBeneficial Arizona Inc...................................... DelawareBeneficial California Inc. ................................. DelawareBeneficial Colorado Inc. ................................... DelawareBeneficial Commercial Corporation........................... DelawareBeneficial Commercial Holding Corporation................... DelawareBeneficial Company LLC (f/k/a Beneficial Corporation)....... DelawareBeneficial Connecticut Inc. ................................ DelawareBeneficial Consumer Discount Company........................ Pennsylvania dba BMC of PABeneficial Credit Services Inc. ............................ DelawareBeneficial Credit Services of Connecticut Inc. ............. DelawareBeneficial Credit Services of Mississippi Inc. ............. DelawareBeneficial Credit Services of South Carolina Inc. .......... DelawareBeneficial Delaware Inc. ................................... DelawareBeneficial Direct, Inc. .................................... New JerseyBeneficial Discount Co. of Virginia......................... DelawareBeneficial Facilities Corporation........................... New JerseyBeneficial Finance Co. ..................................... DelawareBeneficial Finance Co. of West Virginia..................... DelawareBeneficial Finance Services, Inc. .......................... KansasBeneficial Florida Inc. .................................... Delaware dba Beneficial Credit Services Inc.Beneficial Franchise Company Inc. .......................... DelawareBeneficial Georgia Inc. .................................... DelawareBeneficial Hawaii Inc. ..................................... DelawareBeneficial Homeowner Service Corporation.................... DelawareBeneficial Idaho Inc. ...................................... DelawareBeneficial Illinois Inc. ................................... DelawareBeneficial Income Tax Service Holding Co., Inc. ............ DelawareBeneficial Indiana Inc. .................................... Delaware dba Beneficial Mortgage Co. of IndianaBeneficial Investment Co. .................................. DelawareBeneficial Iowa Inc. ....................................... IowaBeneficial Kansas Inc. ..................................... KansasBeneficial Kentucky Inc. ................................... DelawareBeneficial Land Company, Inc. .............................. New JerseyBeneficial Leasing Group, Inc. ............................. Delaware US -- STATENAMES OF SUBSIDIARIES ORGANIZED--------------------- --------------Beneficial Loan & Thrift Co. ............................... MinnesotaBeneficial Loan Corporation of Kentucky..................... KentuckyBeneficial Louisiana Inc. .................................. DelawareBeneficial Maine Inc. ...................................... Delaware dba Beneficial Credit ServicesBeneficial Management Corporation........................... DelawareBeneficial Management Corporation of America................ DelawareBeneficial Management Headquarters, Inc. ................... New JerseyBeneficial Management Institute, Inc. ...................... New YorkBeneficial Mark Holding Inc. ............................... DelawareBeneficial Maryland Inc. ................................... DelawareBeneficial Massachusetts Inc. .............................. DelawareBeneficial Michigan Inc. ................................... DelawareBeneficial Mississippi Inc. ................................ DelawareBeneficial Missouri, Inc. .................................. DelawareBeneficial Montana Inc. .................................... DelawareBeneficial Mortgage Co. of Arizona.......................... DelawareBeneficial Mortgage Co. of Colorado......................... DelawareBeneficial Mortgage Co. of Connecticut...................... DelawareBeneficial Mortgage Co. of Florida.......................... DelawareBeneficial Mortgage Co. of Georgia.......................... DelawareBeneficial Mortgage Co. of Idaho............................ DelawareBeneficial Mortgage Co. of Indiana.......................... DelawareBeneficial Mortgage Co. of Kansas, Inc. .................... DelawareBeneficial Mortgage Co. of Louisiana........................ DelawareBeneficial Mortgage Co. of Maryland......................... DelawareBeneficial Mortgage Co. of Massachusetts.................... DelawareBeneficial Mortgage Co. of Mississippi...................... DelawareBeneficial Mortgage Co. of Missouri, Inc. .................. DelawareBeneficial Mortgage Co. of Nevada........................... DelawareBeneficial Mortgage Co. of New Hampshire.................... DelawareBeneficial Mortgage Co. of North Carolina................... DelawareBeneficial Mortgage Co. of Oklahoma......................... DelawareBeneficial Mortgage Co. of Rhode Island..................... DelawareBeneficial Mortgage Co. of South Carolina................... DelawareBeneficial Mortgage Co. of Texas............................ DelawareBeneficial Mortgage Co. of Utah............................. DelawareBeneficial Mortgage Co. of Virginia......................... DelawareBeneficial Mortgage Corporation............................. DelawareBeneficial Mortgage Holding Company......................... DelawareBeneficial Nebraska Inc. ................................... NebraskaBeneficial Nevada Inc. ..................................... DelawareBeneficial New Hampshire Inc. .............................. DelawareBeneficial New Jersey Inc. ................................. DelawareBeneficial New Mexico Inc. ................................. Delaware US -- STATENAMES OF SUBSIDIARIES ORGANIZED--------------------- --------------Beneficial New York Inc. ................................... New YorkBeneficial North Carolina Inc. ............................. DelawareBeneficial Ohio Inc. ....................................... DelawareBeneficial Oklahoma Inc. ................................... Delaware dba Beneficial Credit ServicesBeneficial Oregon Inc. ..................................... DelawareBeneficial Real Estate Company, Inc. ....................... New JerseyBeneficial Real Estate Joint Venture, Inc. ................. DelawareBeneficial Rhode Island Inc. ............................... DelawareBeneficial Service Corporation.............................. DelawareBeneficial Service Corporation of Delaware.................. DelawareBeneficial South Carolina Inc. ............................. DelawareBeneficial South Dakota Inc. ............................... DelawareBeneficial Systems Development Corporation.................. DelawareBeneficial Technology Corporation........................... DelawareBeneficial Tennessee Inc. .................................. TennesseeBeneficial Texas Inc. ...................................... TexasBeneficial Trademark Co. ................................... DelawareBeneficial Utah Inc. ....................................... DelawareBeneficial Vermont Inc. .................................... DelawareBeneficial Virginia Inc. ................................... DelawareBeneficial Washington Inc. ................................. DelawareBeneficial West Virginia, Inc. ............................. West VirginiaBeneficial Wisconsin Inc. .................................. DelawareBeneficial Wyoming Inc. .................................... Wyoming dba Beneficial Credit ServicesBenevest Escrow Company..................................... DelawareBenevest Group Inc. ........................................ DelawareBenevest Services, Inc. .................................... WashingtonBFC Agency, Inc. ........................................... DelawareBFC Insurance Agency of Nevada.............................. NevadaBMC Holding Company......................................... DelawareBon Secour Properties Inc. ................................. AlabamaBusiness Lakeview, Inc. .................................... DelawareCal-Pacific Services, Inc. ................................. CaliforniaCapital Financial Services Inc. ............................ Nevada dba Capital Financial Services I Inc. dba Capital Financial Services No. 1 Inc. dba CFSI, Inc. dba HB Financial ServicesCentral Insurance Administrators, Inc. ..................... DelawareChattanooga Valley Associates............................... TennesseeCom Realty, Inc. ........................................... DelawareCraig-Hallum Corporation.................................... DelawareDecision One Loan Company of Minnesota...................... Minnesota US -- STATENAMES OF SUBSIDIARIES ORGANIZED--------------------- --------------Decision One Mortgage Company, LLC.......................... North CarolinaEighth HFC Leasing Corporation.............................. DelawareEleventh Avenue Properties Corporation...................... DelawareFifteenth HFC Leasing Corporation........................... DelawareFifth HFC Leasing Corporation............................... DelawareFinancial Network Alliance, L.L.P. ......................... IllinoisFirst Central National Life Insurance Company of New York... New YorkFNA Consumer Discount Company............................... PennsylvaniaFourteenth HFC Leasing Corporation.......................... DelawareFourth HFC Leasing Corporation.............................. DelawareH I Venture Four, Inc. ..................................... FloridaH I Venture One, Inc. ...................................... FloridaH I Venture Three, Inc. .................................... FloridaHamilton Investments, Inc. ................................. DelawareHarbour Island Inc. ........................................ FloridaHFC Agency of Missouri, Inc. ............................... MissouriHFC Commercial Realty, Inc. ................................ DelawareHFC Company LLC (f/k/a Household Group, Inc.)............... DelawareHFC Leasing, Inc. .......................................... DelawareHFS Investments, Inc. ...................................... NevadaHFTA Consumer Discount Co. ................................. PennsylvaniaHFTA Corporation............................................ DelawareHFTA Eighth Corporation..................................... OhioHFTA Fifth Corporation...................................... NevadaHFTA First Financial Corp. ................................. CaliforniaHFTA Fourth Corporation..................................... MinnesotaHFTA Ninth Corporation...................................... West VirginiaHFTA Second Corporation..................................... AlabamaHFTA Seventh Corporation.................................... New JerseyHFTA Sixth Corporation...................................... NevadaHFTA Tenth Corporation...................................... WashingtonHFTA Third Corporation...................................... DelawareHousehold Acquisition Corporation........................... DelawareHousehold Affinity Funding Corporation II................... DelawareHousehold Affinity Funding Corporation III.................. DelawareHousehold Aviation, LLC..................................... DelawareHousehold Business Services, Inc. .......................... DelawareHousehold Capital Markets LLC............................... DelawareHousehold Card Funding Corporation.......................... DelawareHousehold Commercial Financial Services, Inc. .............. DelawareHousehold Commercial of California, Inc. ................... CaliforniaHousehold Company of Maine.................................. MaineHousehold Consumer Loan Corporation......................... NevadaHousehold Consumer Loan Corporation II...................... DelawareHousehold Corporation....................................... Delaware US -- STATENAMES OF SUBSIDIARIES ORGANIZED--------------------- --------------Household Credit Services Overseas, Inc. ................... DelawareHousehold Finance Consumer Discount Company................. PennsylvaniaHousehold Finance Corporation............................... DelawareHousehold Finance Corporation II............................ Delaware dba Household Mortgage Company dba Household Finance Corporation of VirginiaHousehold Finance Corporation III........................... Delaware dba HFC Mortgage of Nebraska dba Household Mortgage Services dba HSBC MortgageHousehold Finance Corporation of Alabama.................... AlabamaHousehold Finance Corporation of California................. DelawareHousehold Finance Corporation of Nevada..................... DelawareHousehold Finance Corporation of West Virginia.............. West VirginiaHousehold Finance Industrial Loan Company................... WashingtonHousehold Finance Industrial Loan Company of Iowa........... IowaHousehold Finance Realty Corporation of Nevada.............. DelawareHousehold Finance Realty Corporation of New York............ DelawareHousehold Financial Center Inc. ............................ TennesseeHousehold Financial Services, Inc........................... DelawareHousehold Global Funding, Inc. ............................. DelawareHousehold Industrial Finance Company........................ MinnesotaHousehold Industrial Loan Co. of Kentucky................... KentuckyHousehold Insurance Agency, Inc. ........................... MichiganHousehold Insurance Agency, Inc. Nevada..................... NevadaHousehold Insurance Group Holding Company................... DelawareHousehold Insurance Group, Inc. ............................ DelawareHousehold Investment Funding, Inc. ......................... DelawareHousehold Ireland Holdings Inc. ............................ DelawareHousehold Life Insurance Co. of Arizona..................... ArizonaHousehold Life Insurance Company............................ MichiganHousehold Life Insurance Company of Delaware................ DelawareHousehold N Q Pension Company............................... DelawareHousehold OPEB I, Inc. ..................................... IllinoisHousehold Pooling Corporation............................... NevadaHousehold Realty Corporation................................ DelawareHousehold Receivables Acquisition Company................... DelawareHousehold Receivables Acquisition Company II................ DelawareHousehold Receivables Funding, Inc. III..................... DelawareHousehold Recovery Services Corporation..................... DelawareHousehold REIT Corporation.................................. NevadaHousehold Relocation Management, Inc. ...................... IllinoisHousehold Servicing, Inc. .................................. DelawareHousehold Tax Masters Acquisition Corporation............... DelawareHousekey Financial Corporation.............................. Illinois US -- STATENAMES OF SUBSIDIARIES ORGANIZED--------------------- --------------HSBC - GR Corp. (f/k/a Household Financial Group, Ltd.)..... DelawareHSBC Affinity Corporation I (f/k/a HFC Card Funding Corporation).............................................. DelawareHSBC Auto Accounts Inc. (f/k/a OFL-A Receivables Corp.)..... DelawareHSBC Auto Credit Inc. (f/k/a Household Automotive Credit Corporation).............................................. DelawareHSBC Auto Finance Inc. (f/k/a Household Automotive Finance Corporation).............................................. DelawareHSBC Auto Receivables Corporation (f/k/a Household Auto Receivables Corporation).................................. NevadaHSBC Bank Nevada N. A. (f/k/a Household Bank (SB), N.A.).... United StatesHSBC Card Services (III) Inc. (f/k/a Household Card Services, Inc.)........................................... NevadaHSBC Card Services (III) Inc. (f/k/a Household Credit Services, Inc.)........................................... DelawareHSBC Card Services II Inc. (f/k/a Household Credit Services II, Inc.)................................................. OregonHSBC Credit Center, Inc. ................................... DelawareHSBC Home Equity Loan Corporation I (f/k/a HFC Revolving Corporation).............................................. DelawareHSBC Insurance Company of Delaware (f/k/a Service General Insurance Company)........................................ OhioHSBC Mortgage Funding Corporation I (f/k/a Household Mortgage Funding Corporation III)......................... DelawareHSBC Mortgage Services Warehouse Lending Inc.(f/k/a HFC Funding Corporation)...................................... DelawareHSBC Pay Services, Inc. (f/k/a Household Payroll Services, Inc.)..................................................... DelawareHSBC Retail Services Inc. (f/k/a Household Retail Services, Inc.)..................................................... DelawareHSBC Single Seller Depositor (USA) LLC...................... DelawareHSBC Taxpayer Financial Services Inc.(f/k/a Household Tax Masters Inc.)............................................. DelawareHSBC TFS I 2005 LLC......................................... DelawareHSBC TFS I LLC.............................................. DelawareHSBC TFS II 2005 LLC........................................ DelawareHSBC TFS II LLC............................................. DelawareHull 752 Corporation........................................ DelawareHull 753 Corporation........................................ DelawareJV Mortgage Capital Consumer Discount Company............... PennsylvaniaJV Mortgage Capital, Inc. .................................. DelawareJV Mortgage Capital, L.P. .................................. DelawareKMD Center, Inc. ........................................... DelawareLeasing at Sixty-First Corporation.......................... DelawareMacray Corporation.......................................... CaliforniamagnUS Services, Inc. ...................................... DelawareMES Insurance Agency, LLC................................... DelawareMetris Receivables, Inc. ................................... DelawareMoore's Realty Inc. ........................................ DelawareMortgage One Corporation.................................... DelawareMortgage Two Corporation.................................... DelawareMTX LLC..................................................... DelawareNeil Corporation............................................ DelawareNineteenth HFC Leasing Corporation.......................... DelawareNorth Indemnity Insurance Company........................... DelawareOld K & B Corporation....................................... MichiganPacific Agency, Inc. ....................................... NevadaPacific Finance Loans....................................... CaliforniaPargen Corporation.......................................... California US -- STATENAMES OF SUBSIDIARIES ORGANIZED--------------------- --------------Personal Mortgage Corporation............................... DelawarePersonal Mortgage Holding Company........................... DelawarePPSG Corporation............................................ DelawareProperties on Twenty-Second Corporation..................... DelawareReal Estate Collateral Management Company................... DelawareRenaissance Bankcard Services of Kentucky................... KentuckySecond HFC Leasing Corporation.............................. DelawareService Administrators, Inc. (USA).......................... ColoradoService Management Corporation.............................. OhioSeven Acres Leasing Corporation............................. DelawareSeventh HFC Leasing Corporation............................. DelawareSilliman Corporation........................................ DelawareSixth HFC Leasing Corporation............................... DelawareSouth Property Corporation.................................. DelawareSouthern Trust Company...................................... DelawareSouthwest Beneficial Finance, Inc. ......................... IllinoisSouthwest Texas General Agency, Inc. ....................... TexasSPE 1 2005 Manager Inc. .................................... DelawareSPE 1 Manager Inc. ......................................... DelawareTampa Island Transit Company, Inc. ......................... FloridaTenth Leasing Corporation................................... DelawareThird HFC Leasing Corporation............................... DelawareThirteenth HFC Leasing Corporation.......................... DelawareTwenty-Sixth Place Corporation.............................. DelawareValley Properties Corporation............................... TennesseeWasco Properties, Inc. ..................................... DelawareWesco Insurance Company..................................... Delaware NON-US AFFILIATES NAMES OF SUBSIDIARIES COUNTRY ORGANIZED--------------------- -----------------Amstelveen FSC, Ltd. ....................................... BermudaBeneficial (Hungary) Financial Services Limited............. HungaryBeneficial Building Company Limited......................... EnglandBeneficial Data Systems Limited............................. EnglandBeneficial Finance a.s...................................... Czech RepublicBeneficial Financial Services Limited....................... EnglandBeneficial Financing Limited................................ EnglandBeneficial Leasing Limited.................................. EnglandBeneficial Limited.......................................... EnglandBeneficial Premium Services Limited......................... EnglandBeneficial Trust Investments Limited........................ EnglandBeneficial Trust Nominees Limited........................... EnglandBFC Insurance (Life) Limited................................ IrelandBFC Insurance Limited....................................... IrelandBFC Ireland (Holdings) Limited.............................. Ireland NAMES OF SUBSIDIARIES COUNTRY ORGANIZED--------------------- -----------------BFC Pension Plan (Ireland) Limited.......................... IrelandBFC Reinsurance Limited..................................... IrelandD.L.R.S. Limited............................................ EnglandEndeavour Personal Finance Limited.......................... EnglandFirst Finance Brokers Limited............................... EnglandHamilton Financial Planning Services Ltd. .................. EnglandHamilton Insurance Company Limited.......................... EnglandHamilton Life Assurance Company Limited..................... EnglandHFC Bank Limited............................................ EnglandHFC Financial Services Holdings (Ireland) Limited........... IrelandHFC Pension Plan (Ireland) Limited.......................... IrelandHFC Pension Plan Limited.................................... EnglandHousehold (Jersey) Limited.................................. Channel IslandHousehold Commercial Canada, Inc. .......................... CanadaHousehold Computer Services Limited......................... EnglandHousehold Finance Limited................................... EnglandHousehold Funding plc....................................... EnglandHousehold Global Holdings, BV............................... NetherlandsHousehold International Europe Limited...................... EnglandHousehold International Netherlands B.V..................... NetherlandsHousehold Investments Limited............................... EnglandHousehold Leasing Limited................................... EnglandHousehold Management Corporation Limited.................... England & WalesHousehold Overseas Limited.................................. EnglandHousehold Realty Corporation Limited........................ CanadaHousehold Trust Company..................................... CanadaHSBC Finance Corporation Canada (f/k/a Household Finance Corporation of Canada).................................... CanadaHSBC Financial Corporation Limited (f/k/a Household Financial Corporation Limited)............................ CanadaHSBC Retail Services Limited (f/k/a Household Financial Corporation Inc.)......................................... CanadaICOM Limited................................................ BermudaInvis Inc. ................................................. CanadaJohn Lewis Financial Services Limited....................... EnglandNight Watch FSC, Ltd. ...................................... BermudaOverseas Leasing Five FSC, Ltd. ............................ BermudaOverseas Leasing Four FSC, Ltd. ............................ BermudaOverseas Leasing One FSC, Ltd. ............................. BermudaOverseas Leasing Twp FSC, Ltd. ............................. BermudaSecurity Trust Limited...................................... EnglandSterling Credit Limited..................................... EnglandSterling Credit Management Limited.......................... EnglandSterling Mortgages Limited.................................. EnglandThe Loan Corporation Limited................................ England EXHIBIT 23 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors of HSBC Finance Corporation: We consent to the incorporation of our report dated March 6, 2006, included inthis Annual Report on Form 10-K of HSBC Finance Corporation (the Company) as ofDecember 31, 2005 (successor basis) and December 31, 2004 (successor basis) andfor each of the years in the two-year period ended December 31, 2005 (successorbasis), and for the period January 1, 2003 through March 28, 2003 (predecessorbasis) and March 29, 2003 through December 31, 2003 (successor basis), into theCompany's previously filed Registration Statements No. 2-86383, No. 33-21343,No. 33-45454, No. 33-45455, No. 33-52211, No. 33-58727, No. 333-00397, No.33-44066, No. 333-03673, No. 333-39639, No. 333-58287, No. 333-58289, No.333-58291, No. 333-47073, No. 333-36589, No. 333-30600, No. 333-50000, No.333-70794, No. 333-71198, No. 333-83474 and No. 333-99107 on Form S-8 andRegistration Statements No. 333-70744, No. 333-60510, No. 333-01025, No.333-47945, No. 333-59453, No. 333-82119, No. 333-45740, No. 333-56152, No.333-73746, No. 333-75328, No. 333-85886, No. 333-33240, No. 333-61964, No.333-111413, No. 333-53862, No. 333-33052, No. 333-72453, No. 333-60543, No.333-64175, No. 333-120494, No. 333-120495, No. 333-120496 and No. 333-100737 onForm S-3. Our report dated March 6, 2006 contains an explanatory paragraph that stateseffective March 28, 2003, HSBC Holdings plc acquired all of the outstandingstock of Household International, Inc. (now HSBC Finance Corporation) in abusiness combination accounted for as a purchase. As a result of theacquisition, the consolidated financial information for the period after theacquisition is presented on a different cost basis than that for the periodsbefore the acquisition and, therefore, is not comparable. /s/ KPMG LLPChicago, IllinoisMarch 6, 2006 EXHIBIT 31 CERTIFICATION OF CHIEF EXECUTIVE OFFICER I, Siddharth N. Mehta, Chairman and Chief Executive Officer of HSBC FinanceCorporation, certify that: 1. I have reviewed this annual report on Form 10-K of HSBC FinanceCorporation; 2. Based on my knowledge, this annual report does not contain any untruestatement of a material fact or omit to state a material fact necessary to makethe statements made, in light of the circumstances under which such statementswere made, not misleading with respect to the period covered by this annualreport; 3. Based on my knowledge, the financial statements, and other financialinformation included in this annual report, fairly present in all materialrespects the financial condition, results of operations and cash flows of theregistrant as of, and for, the periods presented in this annual report; 4. The registrant's other certifying officer and I are responsible forestablishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and c) disclosed in this annual report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based onour most recent evaluation, to the registrant's auditors and the audit committeeof the registrant's board of directors (or persons performing the equivalentfunctions): a) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: March 6, 2006 /s/ SIDDHARTH N. MEHTA -------------------------------------- Siddharth N. Mehta Chairman and Chief Executive Officer EXHIBIT 31 CERTIFICATION OF CHIEF FINANCIAL OFFICER I, Beverley A. Sibblies, Senior Vice President and Chief Financial Officer ofHSBC Finance Corporation, certify that: 1. I have reviewed this annual report on Form 10-K of HSBC FinanceCorporation; 2. Based on my knowledge, this annual report does not contain any untruestatement of a material fact or omit to state a material fact necessary to makethe statements made, in light of the circumstances under which such statementswere made, not misleading with respect to the period covered by this annualreport; 3. Based on my knowledge, the financial statements, and other financialinformation included in this annual report, fairly present in all materialrespects the financial condition, results of operations and cash flows of theregistrant as of, and for, the periods presented in this annual report; 4. The registrant's other certifying officer and I are responsible forestablishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and c) disclosed in this annual report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based onour most recent evaluation, to the registrant's auditors and the audit committeeof the registrant's board of directors (or persons performing the equivalentfunctions): a) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: March 6, 2006 /s/ BEVERLEY A. SIBBLIES -------------------------------------- Beverley A. Sibblies Senior Executive Vice President and Chief Financial Officer EXHIBIT 32 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 The certification set forth below is being submitted in connection with the HSBCFinance Corporation (the "Company") Annual Report on Form 10-K for the fiscalyear ended December 31, 2005 as filed with the Securities and ExchangeCommission on the date hereof (the "Report") for the purpose of complying withRule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (the"Exchange Act") and Section 1350 of Chapter 63 of Title 18 of the United StatesCode. I, Siddharth N. Mehta, Chairman and Chief Executive Officer of the Company,certify that: 1. the Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and 2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of HSBC Finance Corporation. March 6, 2006 /s/ SIDDHARTH N. MEHTA -------------------------------------- Siddharth N. Mehta Chairman and Chief Executive Officer This certification accompanies each Report pursuant to Section 906 of theSarbanes-Oxley Act of 2002 and shall not, except to the extent required by theSarbanes-Oxley Act of 2002, be deemed filed by HSBC Finance Corporation forpurposes of Section 18 of the Securities Exchange Act of 1934, as amended. Signed originals of these written statements required by Section 906 of theSarbanes-Oxley Act of 2002 have been provided to HSBC Finance Corporation andwill be retained by HSBC Finance Corporation and furnished to the Securities andExchange Commission or its staff upon request. EXHIBIT 32 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 The certification set forth below is being submitted in connection with the HSBCFinance Corporation (the "Company") Annual Report on Form 10-K for the fiscalyear ended December 31, 2005 as filed with the Securities and ExchangeCommission on the date hereof (the "Report") for the purpose of complying withRule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (the"Exchange Act") and Section 1350 of Chapter 63 of Title 18 of the United StatesCode. I, Beverley A. Sibblies, Senior Vice President and Chief Financial Officer ofthe Company, certify that: 1. the Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and 2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of HSBC Finance Corporation. March 6, 2006 /s/ BEVERLEY A. SIBBLIES -------------------------------------- Beverley A. Sibblies Senior Vice President and Chief Financial Officer This certification accompanies each Report pursuant to Section 906 of theSarbanes-Oxley Act of 2002 and shall not, except to the extent required by theSarbanes-Oxley Act of 2002, be deemed filed by HSBC Finance Corporation forpurposes of Section 18 of the Securities Exchange Act of 1934, as amended. Signed originals of these written statements required by Section 906 of theSarbanes-Oxley Act of 2002 have been provided to HSBC Finance Corporation andwill be retained by HSBC Finance Corporation and furnished to the Securities andExchange Commission or its staff upon request. EXHIBIT 99.1 HSBC FINANCE CORPORATION AND SUBSIDIARIES DEBT AND PREFERRED STOCK SECURITIES RATINGS STANDARD & MOODY'S DOMINION POOR'S INVESTORS BOARD RATING CORPORATION SERVICE FITCH, INC. SERVICE------------------------------------------------------------------------------------------------------AS OF MARCH 6, 2006HSBC Finance Corporation Senior debt................................... A Aa3 AA- AA (low) Senior subordinated debt...................... A- A2 A+ * Commercial paper.............................. A-1 P-1 F-1+ R-1 (middle) Series B preferred stock...................... BBB+ A3 A+ *HFC Bank Limited Senior debt................................... A Aa3 AA- * Commercial paper.............................. A-1 P-1 F-1+ *HSBC Bank Nevada, National Association Senior debt................................... A A1 AA- *HSBC Financial Corporation Limited Senior notes and term loans................... * * * AA (low) Commercial paper.............................. * * * R-1 (middle) --------------- * Not rated by this agency. This information is provided by RNS The company news service from the London Stock Exchange
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Share Price Information for HSBC Holdings (HSBA)
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Share Price:
720.80
Bid:
722.20
Ask:
722.40
Change:
8.20 (1.15%)
Spread:
0.20 (0.028%)
Open:
722.30
High:
724.40
Low:
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Prev. Close:
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