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☆ HSBC turns Silicon Valley Bank calamity into gold
▼ + stars: | 2023-03-13 | by ( ) www.reuters.com time to read: +2 min

LONDON, March 13 (Reuters Breakingviews) - A crisis can be an opportunity for the prepared. That’s what HSBC (HSBA.L) may find with its acquisition of Silicon Valley Bank’s UK arm (SVBUK), announced on Monday morning. The Bank of London, a young clearing bank that also submitted a bid, said on Monday that the HSBC deal was a missed opportunity to promote competition. On that theory, the UK government and Bank of England should have handed SVBUK to a financial-technology startup or a challenger bank, rather than strengthening an established player. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

☆ How Silicon Valley Bank's collapse ripped through global tech
▼ + stars: | 2023-03-13 | by ( Martin Coulter | ) www.reuters.com time to read: +5 min

March 14 (Reuters) - Not long after California startups started pulling money out of troubled Silicon Valley Bank, entrepreneurs in other parts of the world woke up to the news. While the global effects of Silicon Valley Bank's collapse are just emerging, one thing is clear: tech startups, no matter how far apart, are intertwined. FOUNDERS WARYQuincy Lee, founder of Seattle-based EV charging startup Electra Era, tried to move millions of dollars from Silicon Valley Bank on Thursday afternoon as warning signs multiplied. European stocks fell on banking industry concerns, though, and even startups that did not bank with SVB were scrambling. CHINESE STARTUPS MOVING MONEYSVB's Shanghai-based joint venture, SPD Silicon Valley Bank (SSVB), said it had a sound corporate structure and an independent balance sheet.

☆ Morning Bid: Banks rescued, rates recoil, stress builds
▼ + stars: | 2023-03-13 | by ( ) www.reuters.com time to read: +5 min

Early last week as much as a half point rate hike was almost fully priced. Now back as low as 4.8%, the implied peak Fed rate for the cycle has plummeted almost a full percentage point over that time. Goldman Sachs now says it no longer expects the Fed to raise rates on March 21-22. The Federal Reserve also made it easier for banks to borrow from it in emergencies. More broadly, the implications for Fed monetary policy caused most ructions and complicated overall index direction that's torn between bank losses and the repricing of rates.

The pan-European STOXX 600 index (.STOXX) fell 1.7% on broad-based losses, with HSBC (HSBA.L), Deutsche Bank (DBKGn.DE), Barclays (BARC.L), Unicredit (CRDI.MI) and Commerzbank (CBKG.DE) down between 2.7% and 7.2%. If it can happen to a U.S. bank, it could potentially happen to a bank in Europe as well." Next week, the focus is likely to be on the European Central Bank which is expected to hike its key lending rate by 50 bps. Daimler Truck (DTGGe.DE) added 3.5% on dividend payment plans after hitting its 2022 targets and forecasting higher earnings and revenue this year. Reporting by Susan Mathew and Medha Singh in Bengaluru; Editing by Subhranshu Sahu and Dhanya Ann ThoppilOur Standards: The Thomson Reuters Trust Principles.

☆ Big bank selloff rests on tiny kernel of truth
▼ + stars: | 2023-03-10 | by ( Liam Proud | ) www.reuters.com time to read: +3 min

LONDON, March 10 (Reuters Breakingviews) - The travails of Silicon Valley Bank (SIVB.O) are rippling across the global banking system, wiping billions off the market capitalisations of HSBC (HSBA.L), Deutsche Bank (DBKGn.DE) and JPMorgan (JPM.N). It’s nonetheless a useful reminder that rising interest rates bring risks as well as benefits. The trigger for the selloff seems to have been a $1.8 billion equity issue by SVB Financial, which does business as Silicon Valley Bank. Shrinking deposits saw Chief Executive Greg Becker sell down a $21 billion portfolio of Treasury and agency mortgage bonds. As interest rates rise banks are charging more for loans.

The S&P 500 banks index (.SPXBK) dropped 6.6% on Thursday and was set to open lower again on Friday. The crisis at SVG was feeding growing investor concerns that banks will be vulnerable to the rising cost of money. In an unusual step, Commerzbank, one of Germany's largest banks, issued a statement, playing down any threat from SVB, saying it did not see "a corresponding risk for us". "The market is treating this as a potential contagion risk," said Antoine Bouvet, senior rates strategist at ING in London. A spike in interest rates has led to a sell-off in bonds, leaving banks exposed to potential losses on the securities they hold.

[1/2] European Central Bank and SVB (Silicon Valley Bank) logos are seen in this illustration taken March 10, 2023. SVB, which does business as Silicon Valley Bank, was not immediately available for comment. "Silicon Valley Bank is shedding light on vulnerabilities across the US banking sector, primarily in the bond holdings that many large institutions hold," said Karl Schamotta, Chief Market Strategist at Corpay. “The current liquidity run on Silicon Valley Bank is having a knock-on effect on the wider banking system," said Rick Seehra, Prudential Lead at Bovill. But banking experts said SVB's issues were unique and the worries about the broader sector were not warranted.

☆ Credit Suisse shares hit new all-time low as banks hit by U.S. fallout
▼ + stars: | 2023-03-10 | by ( ) www.reuters.com time to read: +1 min

ZURICH, March 10 (Reuters) - Credit Suisse (CSGN.S) shares hit a new all-time low in early trading on Friday as the European banking sector suffered the fallout from a sharp sell-off in U.S. financial stocks. The embattled bank's stock fell to 2.463 Swiss francs on the Swiss Market Index amid the sell-off. Rival UBS (UBSG.S) was down 4.7% as European banking stocks headed for their largest one-day fall in nine months. Europe's STOXX banking index (.SX7P) was down 4.2% and set for its biggest one-day slide since early June, with declines for most major names including HSBC (.HSBA.L) down 4.5% and Deutsche Bank (DBKGn.DE) off 7.9%. Reporting by John Revill; editing by Jason NeelyOur Standards: The Thomson Reuters Trust Principles.

☆ Europe's lenders sucked into global banks rout
▼ + stars: | 2023-03-10 | by ( Alun John | ) www.reuters.com time to read: +2 min

[1/4] The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, March 8, 2023. The episode underscored the vulnerability of banks, many of which were propped up by taxpayers' cash following the global financial crisis more than a decade ago. Investors in SVB's stock had fretted over whether the capital raise would be sufficient given the deteriorating fortunes of many technology startups that the bank serves. But some startups have been advising their founders to pull out their money from SVB as a precautionary measure, the sources added. Writing By John O'Donnell; Additional reporting by Jo Mason; Editing by Elisa Martinuzzi and Toby ChopraOur Standards: The Thomson Reuters Trust Principles.

UK banks (.FTNMX301010) dropped to an eight-week low, spooked by a brutal rout in U.S. bank SVB Financial (SIVB.O) following a share sale. The FTSE 100 (.FTSE) slipped 1.9% to a five week low, while the more domestically focused mid-cap index (.FTMC) gave up 2.1% to hit a two-month low. The FTSE 100 is set to the end the week down about 2.8% in what could be its worst week since September, as worries around hawkish central banks sapped risk appetite. Next week, investors will be watching for UK Chancellor Jeremy Hunt's spring budget. Reporting by Susan Mathew in Bengaluru; Editing by Savio D'Souza and Saumyadeb ChakrabartyOur Standards: The Thomson Reuters Trust Principles.

☆ European bank shares tumble day after U.S. market turmoil
▼ + stars: | 2023-03-10 | by ( ) www.reuters.com time to read: 1 min

LONDON, March 10 (Reuters) - European banking stocks headed for their largest one-day fall in nine months on Friday, a day after a sharp sell-off in U.S. banks. Europe's STOXX banking index (.SX7P) fell 4.2%, set for its biggest one-day slide since early June, with declines for most major names including HSBC (.HSBA.L) down 4.5% and Deutsche Bank (DBKGn.DE) down 7.9%. S&P 500's bank index (.SPXBK) finished down 6.6% on Thursday after tech-industry lender SVB Financial Group (SIVB.O) launched a share sale to shore up its balance sheet due to declining deposits from startups struggling for funding. Reporting by Alun John; Editing by Amanda CooperOur Standards: The Thomson Reuters Trust Principles.

☆ HSBC China says it's unaware of remittance curbs after Mobius' claims
▼ + stars: | 2023-03-07 | by ( ) www.reuters.com time to read: +2 min

HSBC China made the statement in response to Reuters' questions regarding Mark Mobius' claims that he could not remit his money out of China from his account with HSBC in Shanghai due to China's capital controls. Mobius, founder of Mobius Capital Partners, told FOX Business last week that he faced all kinds of barriers in the process, including requirements to show records from 20 years of how he made the money. HSBC China declined to comment on individual client circumstances but said: "As common practices in many countries commercial banks conduct businesses under operational procedures and control requirements for processing transactions appropriately." The Chinese forex regulator added it will urge commercial banks to optimise cross-border financial services and improve quality of service. Reporting by Shanghai newsroom; Editing by Christopher Cushing and Sam HolmesOur Standards: The Thomson Reuters Trust Principles.

☆ FTSE 100 opens lower as ex-dividend trading weighs on HSBC
▼ + stars: | 2023-03-02 | by ( ) www.reuters.com time to read: +1 min

SummarySummary Companies FTSE 100 down 0.3%, FTSE 250 off 0.3%March 2 (Reuters) - UK's FTSE 100 opened lower on Thursday as ex-dividend trading impacted shares of HSBC, although upbeat earnings from Ireland's CRH and jets and auto parts supplier Melrose helped cap losses. The blue-chip FTSE 100 (.FTSE) lost 0.3% by 0821 GMT, while the domestically-focused FTSE 250 midcap index (.FTMC) fell 0.3%. Shares of HSBC (HSBA.L) fell 3.5% in early trading while the broader banking index (.FTNMX301010) dropped 2.3%. Flutter (FLTRF.L) dropped 4.9% after the betting company reported full-year core profit at the lower end of its forecast range. Melrose Industries (MRON.L) posted a jump in profit for the year ended Dec. 31, lifting shares 4.2% higher.

☆ Hong Kong’s office landlords face a tough rebound
▼ + stars: | 2023-03-01 | by ( Thomas Shum | ) www.reuters.com time to read: +3 min

HONG KONG, March 1 (Reuters Breakingviews) - Hong Kong offices are emptier than in other Asian financial centres. Singapore and Tokyo boast rates well under half of Hong Kong’s level, and figures there are either improving or roughly unchanged. Last year, mainland-based companies accounted for less than 6% of all leases in Hong Kong’s key Central business district, from nearly 30% in 2019. Hong Kong’s economy shrunk for three of the last four years, and its population is slimming too. However, the plan to reduce its office footprint may not apply to Hong Kong, a person familiar with the situation told Breakingviews.

☆ HSBC plans to issue $2 bln worth of securities, list in Ireland
▼ + stars: | 2023-03-01 | by ( ) www.reuters.com time to read: 1 min

March 1 (Reuters) - HSBC Holdings (0005.HK), (HSBA.L) said on Wednesday it intends to issue next week $2 billion worth of 8% convertible securities, which are expected to trade on the Global Exchange Market of the Irish Stock Exchange within a month of issuance. Reporting by Sameer Manekar in Bengaluru; Editing by Sherry Jacob-PhillipsOur Standards: The Thomson Reuters Trust Principles.

☆ British lawmakers ramp up pressure on banks over savings rates, exec pay
▼ + stars: | 2023-03-01 | by ( Iain Withers | ) www.reuters.com time to read: +2 min

The Treasury Committee noted profit margins at the four biggest British banks - Lloyds Banking Group (LLOY.L), NatWest (NWG.L), HSBC (HSBA.L) and Barclays (BARC.L) - increased in 2022 earnings published last month, while some also bumped up boardroom pay. The committee has asked the four banks to justify why they offer less than 1% interest on easy access savings accounts, despite the Bank of England benchmark rate rising to 4%. Banks reported robust profits for 2022 in earnings last month, but warned margins could already have peaked as competition steps up. Analysts have questioned whether political pressure could have been a factor in banks outlining cautious guidance on their future earnings potential. Reporting by Iain Withers; editing by Sinead Cruise, Kirsten DonovanOur Standards: The Thomson Reuters Trust Principles.

Feb 27 (Reuters) - Three banks agreed to pay $1.35 billion to resolve litigation by former Allen Stanford investors who accused them of contributing to the imprisoned financier's massive Ponzi scheme. Canada's Toronto-Dominion Bank <TD.TO> will pay $1.205 billion, HSBC Holdings Plc (HSBA.L) will pay $40 million and Independent Bank Group Inc (IBTX.O) , formerly Bank of Houston, will pay $100 million. They avert a trial that had been scheduled for Monday in Houston federal court, where TD, HSBC and Independent Bank were the last remaining defendants. Two other defendants, France's Societe Generale SA (SOGN.PA) and Mississippi-based Trustmark Corp (TRMK.O), settled for a respective $157 million and $100 million earlier this year. Independent Bank expects to recognize a $100 million first-quarter expense for its settlement, a regulatory filing shows.

Instead, despite reporting robust profits, banks' shares have broadly stumbled as they forecast margin pressure, suggesting intensifying competition for customers' deposits and mortage business to come. "It may be that we've seen the peak of margin," said William Chalmers, finance chief of Britain's biggest domestic bank Lloyds (LLOY.L) on Wednesday. Lenders say they have started to pass on higher rates to savers, adding that profitability is rebounding after years of low margins. Pressure to immediately increase the rates banks pay savers has been intensified by the digital offerings from U.S. entrants into the market such as JPMorgan and Goldman Sachs, executives at the top British lenders said. In contrast to floating rates, which broadly track the Bank of England benchmark, fixed mortgage rates have started to fall as competition intensifies.

☆ Analysis: Boom in European bank earnings hints at a rally with legs
▼ + stars: | 2023-02-23 | by ( Joice Alves | ) www.reuters.com time to read: +5 min

The euro zone is expected to stagnate rather than contract, while cost of borrowing is still rising. The European Central Bank's campaign to raise interest rates as it fights to bring inflation back to its 2% target has been a boon for euro zone lenders. In the meantime, euro zone lenders' earnings per share (EPS) have surged to their highest since the global financial crisis in 2008. In the United State, where the rate cycle is more advanced, there's less potential for earnings upgrades at this point, she said. Earnings euro zone banks($1 = 0.9408 euros)Reporting by Joice Alves and additional reporting by Samuel Indyk in London; editing by Amanda Cooper and Sharon SingletonOur Standards: The Thomson Reuters Trust Principles.

☆ London stocks fall as rate hike worries linger, Lloyds drags
▼ + stars: | 2023-02-22 | by ( Shashwat Chauhan | ) www.reuters.com time to read: +2 min

The blue-chip FTSE 100 (.FTSE) lost 0.9%, hitting its lowest level in over a week. The banking sector (.FTNMX301010) lost 1.4%, with shares of HSBC (HSBA.L) off 1.2% and Prudential (PRU.L) down 2.3%. London-listed shares of Rio Tinto (RIO.L) slumped 2.5% after the global miner posted a 38% drop in annual profit and more than halved its dividend. Those worries remain in focus ahead of the release, later in the day, of the minutes of the U.S. Federal Reserve's latest meeting. Despite the session's losses, the exporter-heavy FTSE 100 has had a strong start to the year, helped by some positive earnings and a stir in commodity prices.

The London-headquartered bank (HSBA.L) said on Tuesday it would pay a special dividend of $0.21 per share, from the proceeds of the $10 billion sale of its Canada business. HSBC's conservative outlook echoed that of British rival NatWest (NWG.L), which warned last week that profit earned from rising interest rates may have peaked. HSBC said annual expected credit losses rose to $3.6 billion, more than the $3.2 billion analysts had estimated, due to rising inflation pressuring borrowers and lingering problems in China's property market. That matched the $17.5 billion average estimate of 22 analysts compiled by the bank. Meanwhile, HSBC said it still expects to complete the sale of its Russia business in first-half 2023, taking a $300 million loss.

But some analysts had expected HSBC to also raise its key performance target of reaching a return on tangible equity of at least 12% from this year onwards, a target the bank stuck to in its earnings report. Meanwhile, HSBC said it still expects to complete the sale of its Russia business in first-half 2023, taking a $300 million loss. So far this year, the shares have risen 20% versus a 7% rise in the FTSE index (.FTSE). HSBC said annual expected credit losses rose to $3.6 billion, more than the $3.2 billion analysts had estimated, due to rising inflation pressuring borrowers and lingering problems in China's property market. Despite the fourth-quarter surge, annual profit fell to $17.5 billion from $18.9 billion for 2021, due to an impairment of $2.4 billion related to the sale of its retail banking operations in France.

☆ Morning Bid: Cast away
▼ + stars: | 2023-02-21 | by ( ) www.reuters.com time to read: +2 min

With U.S. markets set to reopen after Monday's holiday, investor focus will be squarely on minutes from the Feb. 1 Federal Reserve meeting, scheduled to be released on Wednesday. At that meeting, the central bank raised interest rates by 25 basis points and said disinflation was underway. Meanwhile, Russian President Vladimir Putin was due to make a speech on Tuesday setting out aims for the second year of his invasion of Ukraine. Europe's largest bank HSBC Holdings (HSBA.L) unveiled plans for a special dividend and share buybacks as rising interest rates swelled net interest income. Earnings from Walmart (WMT.N) later in the day will shed light on American consumers' buying habits in the face of rising expenses.

☆ HSBC takes $300 mln hit on Russia business sale, says deal on track for 2023
▼ + stars: | 2023-02-21 | by ( Lawrence White | ) www.reuters.com time to read: +1 min

Europe's biggest bank has taken a $300 million loss on the expected sale of the business, HSBC said as it reported its annual results for 2022. HSBC said in July last year the deal was pending approval from Russia's government and regulators, shortly before Deputy Finance Minister Alexei Moiseev said Russia would block the sale of foreign banks' Russian businesses. Credit Suisse last July was banned from disposing of shares in its Russian unit by a Moscow court which also ordered the seizure of 10 million euros ($10.7 million) from the Swiss bank. HSBC's operations in Russia consisted of a corporate banking business which offered a range of lending and investment banking services to domestic and multinational customers. It employed around 200 people on the eve of Russia's invasion, HSBC Chief Financial Officer Ewen Stevenson said at the time.

☆ HSBC Q4 profit rockets 92% as rising interest rates boost revenue
▼ + stars: | 2023-02-21 | by ( ) www.reuters.com time to read: 1 min

SINGAPORE/LONDON, Feb 21 (Reuters) - HSBC Holdings (HSBA.L) reported a better-than-expected 92% surge in quarterly profit on Tuesday as rising interest rates swelled its net interest income, encouraging Europe's largest bank to reiterate it could meet a key performance target for this year. The bank said it intended to pay a special dividend of $0.21 per share, as a priority use of the proceeds from the $10 billion sale of its Canada business, once that disposal is complete late this year. Reporting by Anshuman Daga and Lawrence White; Editing by Kenneth MaxwellOur Standards: The Thomson Reuters Trust Principles.

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