Jan. 7, 2014, 11:38 AM| Comment!
Dec. 10, 2013, 12:48 PM
- HSBC looks to move more non-core assets of the books, agreeing to sell its 8% stake in Bank of Shanghai to Banco Santander (SAN -0.2%). The price hasn't been disclosed, but the stake was last seen on HSBC's balance sheet as an available-for-sale asset with fair value around $468M.
- "Our priorities going forward will emphasize the growth of our own operations in mainland China and our own partnership with Bank of Communications," says HSBC Asia Pacific boss Peter Wong.
- The deal, subject to regulatory approvals, is expected to close in H1.
Dec. 9, 2013, 8:39 AM
- While HSBC did consider a float of its U.K. operations in wake of the financial crisis, people familiar with the matter deny the bank is currently in the process of prepping an IPO, reports the WSJ.
- Among the issues: HSBC already has plenty of liquidity looking to find a good investment home, so what would be the plan to profitably invest the proceeds of a sale?
- Earlier coverage
Dec. 9, 2013, 3:32 AM
- HSBC (HSBC) has reportedly asked investors if they would support the bank selling up to 30% of its U.K. unit in an IPO that could value the subsidiary at an estimated £20B.
- A listing of the business would help HSBC comply with the terms of the incoming Vickers rules, which require U.K. banks to ring-fence their domestic retail banking operations. Increasing capital requirements may also make the flotation logical, while it could unlock shareholder value as well, given investor optimism towards the U.K. and its banking sector.
- The news comes as other banks prepare to list subsidiaries in the U.K., including Lloyds, RBS and Santander.
- HSBC's shares are +0.4% in London.
Dec. 4, 2013, 5:51 AM
- As flagged, the EU Commission has fined international banks €1.71B for the manipulation of inter-bank interest rates, including.
- The banks fined are Citigroup (C) [€70M], Deutsche Bank (DB) [€726M], Royal Bank of Scotland (RBS) [€391M], JPMorgan (JPM) [€79.9M] and Societe Generale (SCGLF) [€446M].
- UBS (UBS), Barclays (BCS) and Citigroup helped expose the cartels and so received immunity for their violations. UBS avoided a fine of €2.5B and Barclays €690M, while Citigroup's was €55M lower as a result.
- The EU has opened proceedings against HSBC (HSBC) and Credit Agricole (CRARF), as well as against JPMorgan (JPM), for Euribor infractions. JPM's fine is for Tibor violations. (PR)
Dec. 4, 2013, 4:57 AM
- The EU Commission will reportedly fine a group of leading multinational banks €1.7B for rigging inter-bank interest rates in what would be the largest antitrust penalty that the commission has ever levied.
- The banks to be fined include all the old favorites - Citigroup (C), Deutsche Bank (DB), Royal Bank of Scotland (RBS), JPMorgan (JPM) and Barclays (BCS), as well as Societe Generale (SCGLF).
- The banks have admitted liability in return for a 10% reduction in their punishment.
- However, HSBC (HSBC) and Credit Agricole (CRARF) are contesting the proposed sanctions from the EU and are set to be formally charged today.
- UBS (UBS), which paid $1.5B to U.S. and U.K. authorities for similar sins, is escaping a penalty, as it alerted the EU to the Libor and Tibor cases.
- EU Competition Commissioner Joaquin Almunia is due to announce the penalties at a press conference at 5:30 ET.
Dec. 3, 2013, 1:44 PM
- HSBC (HSBC -1%) is the downside outlier in a green U.K. banking sector after Nomura downgrades to Hold.
- In other U.K. banking news, RBS is forced to issue an apology for another technical glitch which left customers unable to access their accounts through ATMs, or pay for purchases with debit cards.
- CEO Hester: "Last night’s systems failure was unacceptable ... For decades, RBS failed to invest properly in its systems. It will take time, but we are investing heavily in building IT systems our customers can rely on.”
Nov. 26, 2013, 4:12 AM
- The benchmark rate for the $20T gold market has become the latest focus of regulator scrutiny, with the U.K.'s Financial Conduct Authority looking at how the "London fix" is set, Bloomberg reports.
- In a process that goes back to 1919, the rate is published twice a day following a telephone call between Barclays (BCS), Deutsche Bank (DB), Bank of Nova Scotia (BNS), HSBC (HSBC) and Societe Generale (SCGLY).
- The process can last up to over an hour, with participants being able to use the information from the call to trade gold and its derivatives while the discussion is taking place.
- "It's controlled by a handful of firms with a direct financial interest in where it's set, and there is virtually no oversight - and it's based on information exchanged among them during undisclosed calls," says Rosa Abrantes-Metz of New York University.
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Nov. 7, 2013, 1:46 PM
- The bank could be fined by year's end, reports Bloomberg, and, according to a source, is expected to settle in exchange for a 10% discount on the penalty.
- At issue is a probe into the rigging of yen-based Libor ((Tibor)) submissions. Japanese regulators in 2011 ordered CItigroup (C) and UBS to suspend some operations after the banks' staff were found to have attempted to influence the rate. Tom Hayes - a former trader at both banks - is facing criminal charges in the U.K.
- Separately, Credit Agricole (CRARY) and HSBC (HBC) have walked away from the EU settlement table as it relates to charges over the rigging of Euribor. Barclays (BCS), Deutsche Bank (DB), JPMorgan (JPM), RBS, and SocGen (SCGLY) remain in settlement talks and fines could come as soon as next month.
Nov. 5, 2013, 12:32 PM
- Set to be fined, reports Reuters, are Deutsche Bank (DB), JPMorgan (JPM), HSBC (HBC), RBS, Credit Agricole (CRARY), and SocGen (SCGLY). At issue is the supposed rigging of the benchmark European short-term interest rate, Euribor. Not being fined, says a source, is Barclays, which has had its issues with Libor.
- Some banks have already agreed to settle in exchange for a 10% haircut in their fines, while others are still in negotiations over the size of their penalty. EU rules allow fines for up to 10% of a company's global revenue in these cases, but something much further down the scale seems likely here.
- Banks need to be careful about admitting guilt as part of any settlement as it then opens them up to investor lawsuits.
- In addition to Euribor, the EU has ongoing investigations into benchmark rates tied to the yen and Swiss franc.
Nov. 4, 2013, 4:04 AM
- HSBC's (HBC) underlying revenue flat at $15.59B; overall revenue +3.5% to 15.08B.
- U.K. and Hong Kong markets contributed over half of HSBC's underlying pretax profit.
- Underlying operating expenses -4% to $9.57B.
- Achieved $400M of cost cuts, taking the annualized total to $4.5B since the start of 2011, which is ahead of plan.
- Loan impairment charges and other credit risk provisions $1.59B vs 1.72B a year earlier.
- Compensation for U.K. customers $428M.
- Restructuring and other related costs $158M.
- Core tier 1 ratio 13.3%
- Outlook: "We see reasons for optimism with some evidence of a broadening recovery." (Previous) (PR)
Nov. 4, 2013, 3:46 AM
Oct. 30, 2013, 12:45 PM
- Looking to get around a new EU law limiting bonuses, at least a dozen banks - including HBC, and BCS - are considering "role based" monthly allowances to make up for money previously given as annual performance rewards. The total annual pay and bonus won't change, but it would comply with the law.
- The new rule "clearly puts us at a competitive disadvantage to the American and Asian banks operating in our markets," says Richard Meddings, finance director at Standard Chartered (SCBFF). Not saying if his bank will pay these allowances, Meddings does say Standard Chartered "will continue to be very competitive with our staff."
Oct. 24, 2013, 1:19 PM
- Bank of England Governor Mark Carney continues to remake the U.K. central bank into something more "Fed-like." In a major speech and even more major break with his predecessor at the bank, Carney makes it clear the BOE will stand behind lenders facing liquidity issues and rejects the country's antipathy towards the sector.
- "If organized properly, a vibrant financial sector brings substantial benefits . . . The UK’s financial sector can be both a global good and a national asset ... The BOE today is the friend of resilient banks, continuous markets, and good collateral."
- "The Bank of England’s task is to ensure that the UK can host a large and expanding financial sector in a way that promotes financial stability."
- U.K. banks: BCS, RBS, HBC, LYG.
- The pound (FXB) has slipped about 20 pips since the speech was released.
- Webcast and press conference.
Oct. 20, 2013, 2:03 AM
- The $2.46B that HSBC (HBC) must pay to settle a case involving its Household International unit may not be the end of the matter.
- HSBC was told to pay the sum after Household was found to have misled investors about the quality of its loans and to have carried out predatory lending.
- However, the money doesn't account for 25,000 pending claims of over $650M, lawyers for the plaintiffs said.
Oct. 18, 2013, 4:51 AM
- HSBC (HBC) plans to appeal a U.S. court ruling that it pay $2.46B from a case involving Household International, the credit card and mortgage lender that the British bank bought in 2002 for $14B.
- Household lost a class-action lawsuit charging that it misled investors about the quality of its loans in 2001-02 - before the HSBC purchase - and thereby inflating its share price. Household was also accused of predatory lending.
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