HSBC Holdings PLC Statement re Bank of England 2016 stress test
November 30 2016 - 3:50AM
Dow Jones News
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RNS Number : 5228Q
HSBC Holdings PLC
30 November 2016
STATEMENT ON THE BANK OF ENGLAND
2016 STRESS TEST RESULTS
HSBC Holdings plc ('HSBC') notes the publication today of the
results of the Bank of England's 2016 concurrent stress test
exercise. The Bank of England's results show that, under the
hypothetical stress scenario, HSBC's common equity tier 1 ('CET1')
ratio would fall to a low point of 9.1%, well above HSBC's CET1
hurdle rate and systemic reference point ratios of 6.1% and 7.3%,
respectively.
The Bank of England's stress scenario has been designed under
the new annual cyclical scenario framework and modelled a
hypothetical synchronised global downturn with growth in Hong Kong
and China and other emerging market economies in which HSBC
operates being particularly adversely affected. Under this severe
scenario, the results demonstrate the impact of our strategic
actions and the Group's continued capital strength.
The results incorporate management actions that have been
accepted by the Bank of England for the purposes of this exercise
and CRD IV restrictions in the year of low point CET1 ratio. Under
adverse economic circumstances, we would in practice consider a
variety of management actions depending on the particular
prevailing circumstances. Our intention, as evidenced by past
actions, is to maintain a conservative and prudent stance on
capital management.
The Bank of England's 2016 stress test results are available to
view in full on the Bank of England's website at:
http://www.bankofengland.co.uk/financialstability/Documents/fpc/results301116.pdf
Investor enquiries
to:
Mark Phin +44 (0) 20 7992 investorrelations@hsbc.com
Rebecca Self 6923 investorrelations@hsbc.com
+44 (0) 20 7992
5897
Media enquiries
to:
Heidi Ashley +44 (0) 20 7992 heidi.ashley@hsbc.com
Gillian James 2045 gillian.james@hsbcib.com
+44 (0) 20 7992
0516
Notes to editors:
1. HSBC's results reflect the sale of our entire business in
Brazil, comprising HSBC Bank Brasil S.A - Banco Multiplo and HSBC
Servicios e Participacoes Ltda, on 1 July 2016.
2. The regulatory treatment of our investment in Bank of
Communications Co., Limited ('BoCom') changed from proportional
consolidation of BoCom's risk-weighted assets ('RWAs') to a
deduction from capital (subject to regulatory thresholds) at 30
September 2016. Our results do not reflect this change in the
regulatory treatment. We have included the proportional
consolidation of BoCom's RWAs in our results.
3. HSBC's CET1 hurdle rate of 6.1% is the sum of the CRD IV
minimum CET1 ratio of 4.5% and our Pillar 2A CET1 capital
requirement of 1.6%.
4. HSBC's CET1 systemic reference point of 7.3% is the sum of
our hurdle rate and current phased-in G-SIB buffer in the year of
our low point CET1 ratio (1.25%). Our current G-SIB buffer is being
phased in from 1 January 2016 (0.625%) to 1 January 2019
(2.5%).
HSBC Holdings plc
HSBC Holdings plc, the parent company of the HSBC Group, is
headquartered in London. The Group serves customers worldwide from
around 4,400 offices in 71 countries and territories in Europe,
Asia, North and Latin America, and the Middle East and North
Africa. With assets of US$2,557bn at 30 September 2016, HSBC is one
of the world's largest banking and financial services
organisations.
ends/all
This information is provided by RNS
The company news service from the London Stock Exchange
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November 30, 2016 03:35 ET (08:35 GMT)
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