Thu, Apr. 9, 1:21 PM
- A French investigation into tax-related issues at HSBC's Swiss subsidiary, has expanded to include the parent company. The French have set bail at €1B vs. just €50M when the probe focused on just the Swiss unit.
- The expanded investigation, reports The Guardian, continues to focus on large-scale patterns of wrongdoing at the bank, including enabling tax avoidance and evasion, handing out bundles of cash to clients without question, and providing accounts to the friends and families of dictators.
- “((NYSE:HSBC)) intends to appeal and will defend itself vigorously in any future proceedings.”
Thu, Apr. 2, 4:18 AM
- HSBC (NYSE:HSBC) is making progress toward cleaning up its operations, after reaching a $1.92B settlement of charges related to money laundering, but has not done enough, announced the U.S. Department of Justice on Wednesday.
- The government made its criticisms after reviewing the findings of an independent monitor, Michael Cherkasky, who was appointed in connection with the bank's 2012 deferred prosecution agreement with U.S. authorities.
- Previously: Bloomberg: Monitor says HSBC falling short on compliance (Mar. 30 2015)
Wed, Apr. 1, 6:59 AM
- NY Judge John Michalski has dismissed a lawsuit filed by the state's attorney general which accused HSBC of ignoring a law designed to protect homeowners from foreclosure.
- The lawsuit, filed in 2013 by Eric Schneiderman, alleged HSBC violated a state law known as a request for judicial intervention, which entitles homeowners to settlement conferences within 60 days to negotiate loan modifications.
- Michalski dismissed the case by ruling that HSBC's delay or failure in filing the administrative paperwork was procedural, not substantive, and did not qualify as an "illegal act."
Mon, Mar. 30, 3:44 PM
- The 1K page report cites a number of issues with the bank's reforms and compliance procedures, and finds the pace of change inadequate. Bank execs reportedly engaged in shouting matches with the auditors, who claim documents were created after the fact to explain why alerts were dismissed.
- As part of a $1.9B 2012 settlement, HSBC agreed to install a monitor, and his first full-year report was scheduled to be filed at the DOJ this January, with a summary to be made public this week.
- “The idea that a company as big and vast and as far-flung as HSBC was going to be able to do this without powerful incentives for people at the top was probably a gaping hole in a settlement reached some time ago," says a law professor.
- Source: Bloomberg
Mon, Mar. 30, 9:17 AM
- Unlike last year's stress test which focused on a U.K. property bust, this year's version deals more with how banks would handle a global economic slowdown and market tumble, suggesting lenders like HSBC, Standard Chartered (OTCPK:SCBFF), and Barclays (NYSE:BCS) could have a tougher go of it.
- The seven lenders tested will have to maintain a CET 1 ratio of 4.5% and a leverage ratio of 3%.
- Also to tested: RBS, Lloyds (NYSE:LYG), Santander U.K. (NYSE:SAN), and Nationwide Building Society.
- Results are due in December.
- Sources: Bank of England, WSJ
Tue, Mar. 24, 3:26 AM
- The Federal Reserve and FDIC have vetoed the "living wills" of the U.S. units of BNP Paribas (OTCPK:BNPQF), HSBC (NYSE:HSBC) and Royal Bank of Scotland (NYSE:RBS), stating that they could face sanctions by the end of the year if the issues are not fixed.
- Living wills, which are a requirement under Dodd-Frank, spell out how a firm would wind down its operations under U.S. bankruptcy code if it got into trouble.
Wed, Mar. 18, 2:38 AM
- The DOJ is considering revoking years-old settlements and prosecuting banks for manipulating interest rates should they be found to have committed currency-rigging after after deals were negotiated.
- "Where banks fail to live up to their commitments, we will hold them accountable," said the DOJ's Leslie Caldwell. "The criminal division will not hesitate to tear up a DPA or NPA and file criminal charges."
- Banks under investigation: BCS, RBS, UBS, HSBC
Tue, Mar. 10, 2:41 AM
- "Either you’re completely incompetent in your oversight duties or you knew about it," said Britain's chairwoman of the Public Accounts Committee, Margaret Hodge, as a parliamentary committee grilled HSBC (NYSE:HSBC) executives over leaked documents that showed the bank helped clients evade taxes from 2007 and before. "I don’t believe you didn’t know," she added.
- Those in the line of fire yesterday included CEO Stuart Gulliver, head of global private banking, Chris Meares, and BBC Trust chairwoman and former chairwoman of HSBC’s audit committee, Rona Fairchild, who Hodge told to resign.
- Previously: HSBC heads testify for parliament (Feb. 25 2015)
- Previously: HSBC executives face U.K. parliament tax inquiry (Feb. 25 2015)
Mon, Mar. 9, 3:44 AM
- Despite all thirty-one global banks passing the first round of the Fed's stress test last Thursday, a tougher second round test this week, known as the Comprehensive Capital Analysis and Review (CCAR), will either approve or disapprove the lenders' capital return plans.
- Last year, Citigroup (NYSE:C) became the only big U.S. bank to have its plans thrown out, with the Fed citing "insufficient" improvement in areas previously flagged. Other 2014 CCAR losers: Citizens (NYSE:RBS), HSBC (NYSE:HSBC) and Santander (NYSE:SAN).
- Previously: All 31 lenders pass the stress test (Mar. 05 2015)
Thu, Mar. 5, 8:28 PM
- The minimum Tier 1 common capital ratio for banks is 5%, according to the Fed, and here's how the 31 lenders stacked up under the central bank's severely adverse scenario vs. a year ago (h/t: WSJ):
- Deutshce Bank (NYSE:DB): 34.7%, not tested a year ago
- DIscover (NYSE:DFS): 13.9% vs. 13.2% a year ago
- Bank of New York Mellon (NYSE:BK): 12.6% vs. 13.1%
- American Express (NYSE:AXP): 12.5% vs. 12.1%
- Northern Trust (NASDAQ:NTRS): 12.3% vs. 11.7%
- State Street (NYSE:STT): 11.8% vs. 13.3%
- Citizens Financial (NYSE:CFG): 10.7% vs. 10.7%
- KeyCorp (NYSE:KEY): 9.9% vs. 9.2%
- Capital One (NYSE:COF): 9.5% vs. 7.8%
- PNC Financial (NYSE:PNC): 9.5% vs. 9%
- Santander Holdings USA (SAN's U.S. unit): 9.4% vs. 7.3%; shares +0.8% after hours
- BMO Financial (BMO's U.S. unit): 9% vs. 7.6%
- Comerica (NYSE:CMA): 9% vs. 8.6%
- Huntington Bancshares (NASDAQ:HBAN): 9% vs. 7.4%
- HSBC North America (NYSE:HSBC): 8.9% vs. 6.6%
- U.S. Bancorp (NYSE:USB): 8.5% vs. 8.2%
- Regions Financial (NYSE:RF): 8.3% vs. 8.9%
- Citigroup (NYSE:C): 8.2% vs. 7.2%
- SunTrust (NYSE:STI): 8.2% vs. 8.8%
- BB&T (NYSE:BBT): 8.1% vs. 8.4%
- MUFG Americas Holdings (NYSE:MTU): 8% vs. 8.1%
- Ally Financial (NYSE:ALLY): 7.9% vs. 6.3%
- Fifth Third Bancorp (NASDAQ:FITB): 7.9% vs. 8.4%
- Wells Fargo (NYSE:WFC): 7.5% vs. 8.2%
- M&T Bank (NYSE:MTB): 7.3% vs. 6.2%
- Bank of America (NYSE:BAC): 7.1% vs. 5.9%; shares +2.1% after hours
- JPMorgan (NYSE:JPM): 6.5% vs. 6.3%
- BBVA Compass (NYSE:BBVA): 6.3% vs. 8.5%
- Goldman Sachs (NYSE:GS): 6.3% vs. 6.9%
- Morgan Stanley (NYSE:MS): 6.2% vs. 6.1%
- Zions Bancorp (NASDAQ:ZION): 5.1% vs. 3.6%; shares -1.7% after hours
- The lenders were also informed today whether their capital return plans would put them below the Fed's 5% threshold, giving them a 6-day window with which to change those requests, if need be. Last year, both BofA and Goldman scaled back their dividend/buyback requests, allowing them to pass the CCAR. This year's CCAR results will be announced on Wednesday.
- 2015 Stress Test Methodology and Results
Wed, Feb. 25, 10:29 AM
- My Swiss bank account - set up to hold his bonus payments - was about privacy, not avoiding taxes, says HSBC (HSBC -1%) CEO Stuart Gulliver, testifying in front of a U.K. parliament committee.
- I pay all my tax and find it abhorrent that some other don't, says bank Chairman Douglas Flint.
- Previously: HSBC executives face U.K. parliament tax inquiry (Feb. 25)
Wed, Feb. 25, 4:23 AM
- HSBC (NYSE:HSBC) chairman Douglas Flint and chief executive Stuart Gulliver will face a grilling by MPs on the U.K.'s Treasury Select Committee of lawmakers today over tax evasion at the bank's Swiss subsidiary, HSBC's underlying performance and whether it should be broken up.
- Adding to the pressure before the hearing is the newly released details of Gulliver's tax arrangements, who uses a Swiss bank account to hold his bonus payments.
Tue, Feb. 24, 2:32 AM
- HSBC (NYSE:HSBC) has set aside another $550M to cover potential fines for alleged manipulation of foreign exchange markets and warned it could face a $500M bill to compensate U.S. customers for debt protection products it offered before May 2012.
- The bank paid $611M to global regulators in November when it was one of six institutions fined over allegations of price fixing and manipulating benchmarks in the $5T-a-day forex market.
Tue, Feb. 24, 1:56 AM
- U.S. officials are probing at least 10 major banks for the possible rigging of precious-metals markets, even though European regulators shelved a similar investigation after finding no evidence of wrongdoing, WSJ reports.
- The DOJ is scrutinizing the price-setting process for gold, silver, platinum and palladium in London, while the Commodity Futures Trading Commission has opened a civil investigation.
- Banks under scrutiny: HSBC, BNS, BCS, CS, DB, GS, JPM, OTCPK:SCGLY, OTCPK:SGBLY, UBS
Mon, Feb. 23, 9:14 AM
Mon, Feb. 23, 4:30 AM
- HSBC (NYSE:HSBC) -4.8% premarket after reporting that profits fell 17% to $18.7B in 2014, down from $22.6B the year before and below the average analyst forecast of $21B.
- The bank, which faced a significant number of fines and settlements last year, also cut its target for RoE to "more than 10%" from a previous target of more than 12%.
- "We deeply regret and apologize for conduct and compliance failures...which were in contravention of our own policies," added HSBC, addressing the allegations about tax evasion at its Swiss operations.
- HSBC chief executive, Stuart Gulliver, has been recently dragged into the tax-evasion scandal after it was claimed that he sheltered millions of dollars in a Panamanian company via its Swiss private bank.
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