Profit at HSBC Bank Canada slipped during the third quarter after the bank took a charge on the sale of its automobile loan portfolio.

Net income for the quarter ended Sept. 30 fell to $121 million, from $145 million in the year-earlier period, the bank reported Friday.

Results for the quarter “were impacted by a loss of $20 million after related income taxes, arising from the sale of the bank’s $1.5 billion automobile loan portfolio in July 2008,” the bank said in a release.

Excluding net income decreased by 2.8% compared to the third quarter of 2007.

Return on average common equity, a measure of profitability was 15.5% for quarter, compared with 21.3% a year ago.

Total assets grew to $66.9 billion at Sept. 30 compared with $63.6 billion at Sept. 30, 2007, while total funds under management slipped to $24.6 billion from $27.1 billion a year ago..

Commenting on the results, Lindsay Gordon, president and CEO of HSBC Bank Canada, said: “After taking into account the impact of the sale of the bank’s automobile loan portfolio, the results for the third quarter showed considerable resilience despite the ongoing volatility in international credit and liquidity markets.”

“Our balance sheet is conservatively positioned, with strong capital ratios including a Tier 1 ratio of 10.6 per cent. We plan to continue our existing strategy of working with our customers to meet their personal and business needs while maintaining close control over credit quality,” Gordon added.

Vancouver-based HSBC Bank Canada is a subsidiary of HSBC Holdings plc, one of the world’s largest banking and financial services organizations.

IE