Thursday, 9th October 2008

HSBC does not plan to utilise UK rescue initiative

HSBC has no plans to utilise the UK recapitalisation initiative because its principal UK subsidiary continues to be appropriately capitalised and funded from the group's internal resources, reflecting HSBC Group's financial strength.

The announcement comes in view of British government's proposals to provide liquidity and inject capital into the UK banking system. This issue relates to the UK Bank and has no direct implication for Malta, HSBC Malta said.

Contrary to other banks in the UK, HSBC said it will not be utilising the UK government capitalisation scheme because of its financial strength. The UK subsidiary, HSBC Bank plc UK, will observe the capital requirements through HSBC's significant own resources.

In a statement released to stock exchanges around the world, HSBC Group said it supported the UK government's efforts to stabilise the operation of financial markets and in addition provided significant amounts of liquidity to the London Sterling interbank market, lending about £2 billion in three-month and six-month money to other banks.

"The group's announcement to the stock exchanges in light of Wednesday's development in the UK banking market simply reinforces HSBC's global financial strength. This should give shareholders, customers, investors and staff even more confidence in the group," HSBC Malta CEO Alan Richards said.

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Article © Allied Newspapers Ltd., printed on Sunday, November 8, 2009. This article is for personal use only, and should not be distributed.

Comments

George Poitier (on 9/10/08)

In fact Banks make billions of pounds in revenue and profits at the people's expense, and when they get too greedy and get their hand caught in the fire, the Governements use taxpayers money (our money) to bail them out. Great, shall we open a Bank together then.

Paul Smith (on 9/10/08)

HSBC does not need too. All the money it gets in the form of excessive overdraft charges in the UK HSBC remains highly capitalized.
An unauthorized overdraft charge in the UK costs £25. So not only do HSBC have a licence to issue money as debt and use your deposits via the fractional reserve system to lend.

Just remember the system is setup to work for the bankers and bankers only and when the banks get into trouble they are re-capitalized via yours and mine taxes. The banks sole purpose is to make you and i Debt slaves.

This system is unsustainable as it relies on infinite exponential economic growth, problem is most bankers don't realize there are geological constraints to that failed idea.