Why is no-one talking about HSBC?

Conflict

There has been a slanging match going on between Morgan Stanley and HSBC, basically saying HSBC needs to raise more capital - $30-45 Billion they first said. Then HSBC said that's a load of !!!!!!!!, then UBS backed HSBC saying Morgan Stanley was the last one to talk. This week Morgan Stanley started it all off again, saying HSBC may only need $20-30 Billion, this time getting some minor Finance player to agree with them. Really just massive hand bag fight between the banks.

So HSBC aren't without critacism its just coming from one company that is a laughing stock so nobody takes much notice of :rotfl:

itsnever2lateisit?

HSBC formally HongKong and Shanghai Banking Corpn. One of the original 'Hongs' they originated in Hong Kong and the business was built up mainly in Asia, they became domicile in the UK when they bought out Midland Bank (IIRC it was a requirement that they Head Quartered in the UK in order to retain clearing bank status. As a result of their origins the Bank is probably more diversified than any other, which is why they have faired better than almost any other bank. They may well have lost monies in duff AAA+ securities but unlike other they have other sound and profitable areas to provide a cushion.

IIRC the board have discussed moving domicile last year but remain a UK bank for the Time being

They also own Hang Seng Bank, and also the building of that name which houses the Hong Kong Stock Exchange

HTH

Natty68

Just been speaking to hubby about this as he works at HSBC as a Corporate Account Manager as I was curious as to why they hadn't been mentioned. He did say that they aren't a british bank, they are called a global bank due to the fact they own various banks around the world, it's just they are resident in Britain.

In 2006 they technically saw this coming but nobody would listen to them when Mike Geoghan (The CEO) announced in their end of year review. This is why they made all their redunancies then and restructured the bank.

With regards to Canary Wharf, yes they did sell it off but they have also got it back as the new owners defaulted on their loan - ironically from HSBC, so they reacquired the building back.

They also haven't had to take a bail out from the government and aren't thinking of going into this insurance scheme that the government wants all the banks to go into. They have also said that if Brown insists they join this scheme of his then they will move head office to Hong Kong..

From the press reviews and the meetings coming from hubbys offices everything is as they would expect it to be. Yes they do have areas of deficit but then that is to be expected, but they certainly don't need to raise the capital that Morgan Stanly are wittering on about.

I think it is annoying the financial sector that HSBC is one of the ones that is very strong during this climate and basically Brown can't dictate how he wants them to behave etc..

sabretoothtigger

They are a world bank, I'd rank them like Santander. They have reported massive losses to toxic debts way back in 2007 I think it was.
If anything they've been even more prudent then Santander as they are not snapping up new assets afaik

Asia has problems because they export and sales are suffering, who knows maybe they'll develop their own markets instead of just feeding ours.
They might leave us behind in the dust I reckon


I heard they took back that building (for a lower price no doubt), very canny. Gives money back to the people who owe them money, its all good :rotfl:

They have also said that if Brown insists they join this scheme of his then they will move head office to Hong Kong..

I think brown would leave it open like the tier 1 capital raising. How they ensure their own assets is upto them, they are so massive they just shifted some capital around the group to fund the uk banks higher tier 1 afaik

michaels

I'm not surprised they are doing ok - they have taken the opportunity of the crunch to become much less competitive - their svr used to track 1.25% above the BOE base rate, now it is 2.94% whereas their savings rates have tracked the base rate down. Not having to take Govt money (except for the special liquidity scheme?) has allowed them to thumb their nose at the Govt and not pass on the interest rate cuts to their borrowers, compare this to LTSB who have little choice and Nationwide who take a line fair to their customers rather than just the shareholders...

Still all is not as rosy as was thought a few months ago - initially their large exposure to the emerging markets of the far east was seen as an advantage and a cushion against any US and UK loses. This allowed them to present themselves as a safe haven for funds and hoover up deposits at low rates - now it is not so certain that the Far East won't be hit just as hard, hence the halving of their share price.

sabretoothtigger

Cleaver wrote: »

2) They have a much more equitable loan to asset value. I think they may even have more assets (i.e. money in their lovely big safes) than the money they have lent out. I'm sure Northern Rock had around 12 pounds loaned to every 1 pound saved, although that didn't mean they weren't profitable, just risky. HBSC was much closer to 1 to 1.

All the above could be complete rubbish though, and I'm just as likely to have dreamt all of it as I was seeing it on the news.

This is old info but seems like

omelette451

I think HSBC has been safer because it's bigger, more spread out, and hasn't been quite so reckless as the others. Certainly it had more reserves than many of its UK-based competitors when the 'crunch' started, and actually won a lot of business as a reuslt of its relative security. The bad news is that if it does start to get into real trouble, it will collapse in an enormous way, on a scale no one could ever imagine.

chunky79

Now as far as the recession goes i am still very new to all this and learning lots...I have my Mortgage with HSBC and all my bank accounts.
The other day i got a letter asking me to pay what i was paying back in November 2008, which we are actually thinking of doing, but on the other hand i have had this mortgage for 5 years and have never been asked to overpay my mortgage, could it be that they are trying to claw in extra monies or do they just offer it out as a standard thing?

omelette451

chunky79 wrote: »

could it be that they are trying to claw in extra monies or do they just offer it out as a standard thing?

I don't know about mortgages but I can confirm they are definitely trying to claw back money owed, and are getting pretty desperate about it. I still have an overdraft from my student days (still interest-free, so don't yell it's actually very MSE!) and they've been ringing me up loads begging me to pay it off, despite saying that they know I don't actually have to until next summer. In the end they said just to pay a small sum (I picked £2) every month as it'll stop the computer flagging me up. I assume it's the same situation for you: they won't force you to pay if your contract says you don't have to, but I'd say always consider it if you can afford it (regardless of current events), as the quicker you pay it off the less interest you'll be charged and the more you can enjoy your retirement.

chunky79

omelette451 wrote: »

I don't know about mortgages but I can confirm they are definitely trying to claw back money owed, and are getting pretty desperate about it. I still have an overdraft from my student days (still interest-free, so don't yell it's actually very MSE!) and they've been ringing me up loads begging me to pay it off, despite saying that they know I don't actually have to until next summer. In the end they said just to pay a small sum (I picked £2) every month as it'll stop the computer flagging me up. I assume it's the same situation for you: they won't force you to pay if your contract says you don't have to, but I'd say always consider it if you can afford it (regardless of current events), as the quicker you pay it off the less interest you'll be charged and the more you can enjoy your retirement.

Thankyou for answering me. We have been on about it for about 12 months and not done it yet, my partner became a contractor and we now have a ltd company. I wanted to see how earnings were but i am definately gonna start getting money off it....i used the what mortgage calculator earlier today and just for the extra £120 or so per month it shaves off more years than i though it would. Roughly 8 to 9 would like to have it off in 6, will have to hope OH keeps getting contracts