HSBC's two most senior US officers have been ousted from its troubled North American operation.

Bobby Mehta announced his departure just two weeks after HSBC was forced to make a first profits warning in its 142-year-history because of mushrooming bad debts in US subprime mortgage lending.

He is joined by Sandy Derickson, president and chief executive for HSBC Bank and HSBC USA, who has been replaced by Paul Lawrence, who will also retain his current role as head of corporate, investment banking and markets for North America.

Mr Mehta was chief executive of HSBC North America and chairman and chief executive of HSBC Finance Corporation, formerly Household International, the subsidiary at the heart of the problems.

HSBC said he had resigned with effect from 15 February but the delay was because of the need to get details signed off by the board.

Mr Mehta, an American who joined Household in 1998, is expected to receive a substantial payoff. His executive role at HSBC Finance Corp will be filled by Brendan McDonagh, who is currently chief operating officer there.

Commenting on her departure, Ms Derickson said: "In light of the management changes at HSBC, I have decided that this is a good time for me to take a long-desired break from work so that I have more time for my own interests and my family."

In evidence of London taking firmer control of the wayward US operation, HSBC finance director Douglas Flint becomes non-executive chairman.

HSBC has conceded that mistakes were made in the way second-lien mortgages were sold to people with impaired credit records. The operation was not properly supervised and there were failings in the way risk was assessed.

Mr Mehta said: "I am now ready to pursue more entrepreneurial interests and look forward to this next stage with great anticipation."

Mike Geoghegan, HSBC chief executive, said: "We wish Bobby well. He has made a very significant contribution to a diverse business serving 35 million North American customers and providing some $9 billion (£4.6 billion) in net profit since we acquired Household International in March 2003 for $14.8 billion."

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