Oct 10, 2008 (LBO) – Hong Kong Shanghai Banking Corporation (HSBC) said it has strengthened the capital base of its UK subsidiary, HSBC Bank, through an equity injection of 750million pounds. The bank said in a statement the capital injection, representing one per cent of the total shareholders’ equity of the HSBC Group as at 30 June 2008, has been funded from the Group’s own resources.
The bank said it welcomes the British government’s move to recapitalize the industry and provide much needed liquidity to the markets to improve confidence in the financial sector.
“As previously announced, HSBC has no plans to utilise the UK government’s recapitalisation initiative,” it said.
With a tier one capital ratio of 8.8 per cent and a loan to deposit ratio of 90 per cent as at 30 June 2008, the Group remains one of the most strongly capitalised and liquid banks in the world, it said.
HSBC said it also continues to support efforts to stabilise the operation of financial markets and over the last three days has provided significant amounts of liquidity to the London Sterling interbank market.
The bank has lent around four billion pounds of three-month and six-month money to