HSBC USA Inc 3Q06 10Q ex18

HSBC Holdings PLC
13 November 2006



                                                                      Exhibit 18

Letter from Independent Accountant Regarding Change in Accounting Principles
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November 10, 2006

HSBC USA Inc.
452 Fifth Avenue
New York, NY 10018

Ladies and Gentlemen:

We have been furnished with a copy of the quarterly report on Form 10-Q of HSBC
USA Inc. (the "Company") for the three months ended September 30, 2006, and have
read the Company's statements contained in Note 7 to the condensed consolidated
financial statements included therein. As stated in Note 7, the Company changed
its method of applying an accounting principle for the annual goodwill
impairment test date by changing the impairment test date from the second fiscal
quarter to the third fiscal quarter, and states that the newly adopted method of
applying an accounting principle is preferable in the circumstances because the
date for the annual goodwill impairment test will be consistent with the
impairment test date used by the Company's ultimate Parent, HSBC Holdings plc,
and other subsidiaries. In accordance with your request, we have reviewed and
discussed with Company officials the circumstances and business judgment and
planning upon which the decision to make this change in the method of accounting
was based.

We have not audited any financial statements of the Company as of any date or
for any period subsequent to December 31, 2005, nor have we audited the
information set forth in the aforementioned Note 7 to the condensed consolidated
financial statements; accordingly, we do not express an opinion concerning the
factual information contained therein.

With regard to the aforementioned accounting change, authoritative criteria have
not been established for evaluating the preferability of one acceptable method
of accounting over another acceptable method. However, for purposes of the
Company's compliance with the requirements of the Securities and Exchange
Commission, we are furnishing this letter.

Based on our review and discussion, with reliance on management's business
judgment and planning, we concur that the newly adopted method of accounting is
preferable in the Company's circumstances.

Very truly yours,

/s/ KPMG LLP
--------------------------

KPMG LLP

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