HSBC

  • 19 Mar 2013 at 3:26 PM

The Ballsiest Country In The Western Hemisphere

The passing of the torch.

It’s not Venezuela, now that old Hugo is gone. It’s not Cuba. And it’s definitely not the U.S. Indeed, the ballsiest country on this side of the globe seems to be measuring its cojones against us, in a series of direct throw-downs. And Argentina’s are bigger. Read more »

Deutsche Bank Sinks Right Past HSBC

Getting caught money-laundering for the Iranians and drug cartels is pretty bad for business, as HSBC’s 2012 results demonstrate. But coming into compliance with all these new banking regulations is even worse.

Disgraced though HSBC may be, what with the $4 billion-plus it paid in fines to regulators last year, and the 17% drop in profit that entails, the old Hongkong and Shanghai Banking Corp. managed to shrink less than its friends in Frankfurt in an unusual race backwards, thereby dethroning the Germans as Europe’s largest bank. Read more »

  • 11 Dec 2012 at 5:50 PM

It’s Good To Be Too Big To Fail

So, HSBC is going to have to cough up almost $2 billion for, in effect, running a massive money-laundering operation that helped fund such luminary do-gooders as the Iranian government and Mexican drug gangs. But the U.S. has decided not to throw the cuffs on the British bank because, well, that would be pretty hard. And could create an awful lot of collateral damage that no one needs as the country careens off the fiscal cliff. Read more »

  • 19 Apr 2012 at 7:10 PM

Risk-On, Risk-Off, Risk-Of-Firing

Oh, the world. Go read Jeremy Grantham’s GMO quarterly letter; as always it’s pretty fun. Then go read this HSBC report that Paul Murphy wrote about on Alphaville. These are things you probably know already but are worth remembering. First, Grantham:

The central truth of the investment business is that investment behavior is driven by career risk. In the professional investment business we are all agents, managing other peoples’ money. The prime directive, as Keynes knew so well, is first and last to keep your job. To do this, he explained that you must never, ever be wrong on your own. To prevent this calamity, professional investors pay ruthless attention to what other investors in general are doing. The great majority “go with the flow,” either completely or partially. This creates herding, or momentum, which drives prices far above or far below fair price. There are many other inefficiencies in market pricing, but this is by far the largest. It explains the discrepancy between a remarkably volatile stock market and a remarkably stable GDP growth, together with an equally stable growth in “fair value” for the stock market. This difference is massive – two-thirds of the time annual GDP growth and annual change in the fair value of the market is within plus or minus a tiny 1% of its long-term trend. The market’s actual price – brought to us by the workings of wild and wooly individuals – is within plus or minus 19% two-thirds of the time. Thus, the market moves 19 times more than is justified by the underlying engines!

You probably knew that, though the numbers were new to me.* This though seemed like a useful breakdown: Read more »

  • 28 Jul 2011 at 5:05 PM

Layoffs Watch ’11: HSBC

Yeah, well. Apparently someone has been snacking between meals, and now there will be purges:

“There was a lot of talk about streamlining going on at the last strategy day, so I suppose this is a function of that,” one top 10 HSBC shareholder told Reuters. “It is a quite sprawling bank, and I wouldn’t be surprised if it has got a bit bloated here and there,” he said.

Sky News reports 10,000 cuts to save $3.5 billion. Many cuts will be in retail – shutting down 39 unprofitable markets, selling U.S. credit cards business, and shrinking U.S. retail. Read more »

Remeber Toby Carroll? To recap, he’s a New Zealand-born real estate analyst for HSBC who’s been stationed in Dubai for the last several years. In January, he was jailed after his ex-girlfriend, Priscilla Ferreira, found him and a new girl, Danielle Spencer, in his apartment and proceeded to start slashing curtains, furniture, etc, and go after the Danielle with a knife.** The police were called and all three were sent downtown because in Dubai, sex outside marriage is illegal. After a week in the clink Carroll, who friends describe as “a fun-loving party boy who was dedicated to his job, a snappy dresser who liked women but wasn’t womanizer,” was released (as were the ladies who became friends after being forced to share a mattress in the women’s cell at Bur Dubai police station. Hopefully Carroll’s made the most of his freedom over the last 6 months, because he’s set to be sent back after receiving his sentencing last week. Read more »

As he’s got time on his hands and there’s something cathartic about letting it all out, Bernie Madoff’s been on a little media tour of late (which will culminate with an appearance on Jerry Springer in a paternity episode you don’t want to miss). His last stop was at New York, where Berns told reporter Steve Fishman it irks him that no one ever cares to mention that he “had a successful business and did wonderful things for the industry” during the so-called “legitimate years.” Most recently he sat down for a little chat with the Financial Times and in an interview that will run in the upcoming weekend edition, told the paper that UBS and HSBC are going to have “big problems” and that JPMorgan? Should run and hide.

“I am not a banker but I know that $100bn going in and out of a bank account is something that should alert you to something,” he said from federal prison in Butner, North Carolina. “JPMorgan got all the financial statements…JPMorgan doesn’t have a chance in hell of not coming up with a big settlement [with trustee Irving Picard, who filed a lawsuit against the bank.”

But enough about them. Let’s get back to Berns. Why did he do it? Apparently in the full interview, Bernie says it wasn’t about the money but rather that he was a people pleaser. Read more »