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Major bank will pump £15 billion into Home Loans
Comments
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WestonDave wrote: »HSBC were getting flamed a couple of years ago by a big investor group for not being aggressive enough in its lending policies - the upshot was that the investors didn't like HSBC playing safe at the cost of profits on higher risk lending. I think now we are seeing who was right in that little spat.
If you are thinking of Eric Knight, chief executive of Knight Vinke (is/was/is 1% shareholder of HSBC) I'm not sure you are fully correct about him pushing for aggressive lending. However I could be wrong. It wasn't always that clear to me in newspaper articles all that he wanted. Maybe to concentrate on Asian markets more if I recall correctly. I agreed with him about the need to have clear focus for the direction of a business/bank though.
http://business.timesonline.co.uk/tol/business/movers_and_shakers/article2935780.eceHis first thrusts accused the global bank of misallocating capital and pursuing a misguided strategy of general expansion, and ran to a 75-page report. His latest attack – carried in another spate of copy-dense press ads on Friday – is even sharper.
Knight Vinke has dug up figures which, he says, show that the HSBC board has misled investors over senior executives’ remuneration plans, and how their performance targets are calculated. It’s arcane stuff, but decidedly aggressive, and must make uncomfortable reading for the HSBC chairman, Stephen Green.0 -
IveSeenTheLight wrote: »Or more probably their more prudent previous lending is allowing them to get the best credit risks by offering better deals to the best risks.
If anything they could improve their bank balance with the lowest risks and leave higher risks to other institutions.
Agreed, that's a possibility. The industry should lead them in that direction with LTVs at a level to protect themselves etc.
Just wondered, if the quick expansion element would present them with quality control/capacity issues...presumably some call centre somewhere has been growing to accomodate the extra business...
Like Carphone Warehouse and their debacle over "free" broadband, which was so popular they simply didn't have control over the demand/workload.
Have also seen it before in Insurance, a push for market share ends up a couple of years later in them trying to divest themselves of most of the gains...
With recession gathering pace, even good or very good credit risks, could end up unemployed leading to repo, and being late into an already saturated market must mean a lower than ideal price.
Just possibilites.
Will be interesting to see which way it goes.0 -
Cannon_Fodder wrote: »With recession gathering pace, even good or very good credit risks, could end up unemployed leading to repo, and being late into an already saturated market must mean a lower than ideal price.
But if they are securing new business with lower LTV's then there is scope to cope.
Add in a sprinkle of deffered interest payments and they are at the lowest risk.
I would think you would see repo's affectthose with higher LTV mortgages:wall:
What we've got here is....... failure to communicate.
Some men you just can't reach.
:wall:0 -
What sort of person would actually buy next year?
The most misguided. Good luck to them, they'll need it.
The ones that see 20% off prices and 1% interest rates as a reasonable proposition
'Just think for a moment what a prospect that is. A single market without barriers visible or invisible giving you direct and unhindered access to the purchasing power of over 300 million of the worlds wealthiest and most prosperous people' Margaret Thatcher0 -
If you are thinking of Eric Knight, chief executive of Knight Vinke (is/was/is 1% shareholder of HSBC) I'm not sure you are fully correct about him pushing for aggressive lending. However I could be wrong. It wasn't always that clear to me in newspaper articles all that he wanted. Maybe to concentrate on Asian markets more if I recall correctly. I agreed with him about the need to have clear focus for the direction of a business/bank though.
http://business.timesonline.co.uk/tol/business/movers_and_shakers/article2935780.ece
He made many complaints & in making so many is bound to be able to claim in some area that he was right.
However shareholders in UBS, Credit Suisse, RBS, Barclays, LTSB, Citibank (to name but a few) might wish they had HBSC stock instead.
He also critiscised the bank for not going into investment banking - which surely would have been the worst timed move since GB sold our gold.US housing: it's not a bubble
Moneyweek, December 20050 -
vivatifosi wrote: »Absolutely. I remortgaged with HSBC over the Summer and so did many of my friends, prior to this I wouldn't have looked at them as their deals weren't as good. We all have low LTVs and got good deals - far better than any of the other institutions we spent hours speaking to. I think HSBC is being very shrewd, offering competitive deals but doing it to a sector of the market where they know that the risk is lower.
It wouldn't surprise me to hear that HSBCs strategy is to get say, 40% of the low LTV value market and to leave the rest behind.
Anyone else have similar experience with HSBC?
Interesting, I'm not surprised at how they are operating. My guess is that they will lend mainly in the re-mortgage market.0 -
What sort of person would actually buy next year?
The most misguided. Good luck to them, they'll need it.
The most misguided were surely buying last year and the start of this year and will see the biggest falls in price.
Anyone who buys next year cannot do as badly
Hsbc is the biggest bank in britain but do have operations in the usa afaik, they will have seen profits fall. I wonder how much short term funding they have taken from government
Definitely good newsA while back there was a Tonight type programme on the mortgage crisis - usual dumbed down tosh but there was a useful chart which showed the various banks loans to deposits ratios - HSBC were streets above the others in terms of having more room to lend on the cash they had.
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sabretoothtigger wrote: »I wonder how much short term funding they have taken from government
Definitely good news
I think they refused the governments funding options
It is good news though I agree:wall:
What we've got here is....... failure to communicate.
Some men you just can't reach.
:wall:0 -
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