Strange banking behaviour by BOV

The decision by Bank of Valletta to issue a fuzzy statement on the impact of Lehman's collapse on its operating results smells fishy - it is more so when one considers the fact that the bank failed to give any serious indication of the impact on...

The decision by Bank of Valletta to issue a fuzzy statement on the impact of Lehman's collapse on its operating results smells fishy - it is more so when one considers the fact that the bank failed to give any serious indication of the impact on it.

This smell is further fouled by the MSE's lifting of the price threshold trade range for one day. Someone seems to be hell bent on depressing the price of BOV shares in order to facilitate some near future manoeuvring with the bank's shares.

The issue by HSBC of the 5.9 per cent €2.5 million bond 2018 also raises eyebrows. HSBC claims that the reason for the offer and use of proceeds from bonds is to meet part of its general financing requirements.

What do these requirements include? There is nothing to stop investors from thinking that such requirements may include covering a tiny part of the losses incurred by HSBC (global) following the current financial turmoil. But the cherry on the pudding is that HSBC has decided not to seek a credit rating of an independent rating agency for the bonds on offer. The prospectus lists risks involved but not the level of each risk. So, there is no assessment by any rating agency when all hell has broken loose in the financial sector.

And the MFSA?

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