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HSBC's shares dive to lowest level since 1995 | HSBC's shares dive to lowest level since 1995 |
(about 1 hour later) | |
HSBC's share price has fallen to its lowest level since 1995 amid allegations of money laundering. | HSBC's share price has fallen to its lowest level since 1995 amid allegations of money laundering. |
In 2013 and 2014 the bank allowed fraudsters to transfer millions of dollars around the world even after it had learned of their scam, leaked secret files show. | In 2013 and 2014 the bank allowed fraudsters to transfer millions of dollars around the world even after it had learned of their scam, leaked secret files show. |
HSBC says it has always met its legal duties on reporting such activity. | HSBC says it has always met its legal duties on reporting such activity. |
On Monday in Hong Kong, the shares fell more than 5.3% to close at HK$29.30. In London they fell by a similar amount. | |
Leaked documents from the US Financial Crimes Enforcement Network (FinCEN), involving about $2tn of transactions have revealed how some of the world's biggest banks have allowed criminals to move dirty money around the world. | Leaked documents from the US Financial Crimes Enforcement Network (FinCEN), involving about $2tn of transactions have revealed how some of the world's biggest banks have allowed criminals to move dirty money around the world. |
Shares in rival banks named in the papers have also been hit. At lunchtime, Standard Chartered and Barclays were down by 5% and 6% respectively, while Germany's Deutsche Bank was down 8%. | Shares in rival banks named in the papers have also been hit. At lunchtime, Standard Chartered and Barclays were down by 5% and 6% respectively, while Germany's Deutsche Bank was down 8%. |
The share price falls came against a backdrop of broader negative sentiment on share markets. UK shares were down sharply amid fears of further Covid-related restrictions. | The share price falls came against a backdrop of broader negative sentiment on share markets. UK shares were down sharply amid fears of further Covid-related restrictions. |
HSBC had been under pressure on multiple fronts before the files were leaked and its shares have taken a particularly hard battering this year, falling by some 50%. | HSBC had been under pressure on multiple fronts before the files were leaked and its shares have taken a particularly hard battering this year, falling by some 50%. |
It has been at the sharp end of political pressures in Hong Kong, and from the pandemic fallout. | It has been at the sharp end of political pressures in Hong Kong, and from the pandemic fallout. |
Although HSBC is headquartered in London, more than half of its profits come from Asia and its shares are important components of both the London and Hong Kong share markets. | Although HSBC is headquartered in London, more than half of its profits come from Asia and its shares are important components of both the London and Hong Kong share markets. |
Its role in a $80m (£62m) fraud is detailed inthe FinCEN leak of documents - banks' "suspicious activity reports". | Its role in a $80m (£62m) fraud is detailed inthe FinCEN leak of documents - banks' "suspicious activity reports". |
HSBC moved the money through its US business to HSBC accounts in Hong Kong in 2013 and 2014. | HSBC moved the money through its US business to HSBC accounts in Hong Kong in 2013 and 2014. |
The bank says it has always reported such activity in accordance with its legal obligations. | The bank says it has always reported such activity in accordance with its legal obligations. |
Multiple pressures | Multiple pressures |
HSBC, which is Europe's biggest bank, has set aside between $8bn and $13bn this year for bad loans as it expects more people and businesses to default on their repayments because of the coronavirus pandemic. | HSBC, which is Europe's biggest bank, has set aside between $8bn and $13bn this year for bad loans as it expects more people and businesses to default on their repayments because of the coronavirus pandemic. |
In August, it reported a 65% drop in pre-tax profits to $4.3bn for the first half of the year - much steeper than analysts had forecast. | In August, it reported a 65% drop in pre-tax profits to $4.3bn for the first half of the year - much steeper than analysts had forecast. |
It also became embroiled in a political battle over its support of China's national security law in Hong Kong and was lambasted by both the US and UK. | It also became embroiled in a political battle over its support of China's national security law in Hong Kong and was lambasted by both the US and UK. |
Cost-cutting | Cost-cutting |
HSBC is currently pushing ahead with major restructuring of its global banking operations. | HSBC is currently pushing ahead with major restructuring of its global banking operations. |
Chief executive Noel Quinn, who officially took over in March, said the bank would further pivot into Asia as its European operations lose money. | Chief executive Noel Quinn, who officially took over in March, said the bank would further pivot into Asia as its European operations lose money. |
Mr Quinn said HSBC would "accelerate" an earlier restructuring plan which includes the axing of 35,000 jobs. | Mr Quinn said HSBC would "accelerate" an earlier restructuring plan which includes the axing of 35,000 jobs. |