View more on these topics

Hike in capital requirements would decimate lending, warns HSBC

An increase of just 1% in capital requirements would take hundreds of billions of pounds out of banks’ lending capacity, according to Douglas Flint, group chairman of HSBC.

Speaking to the Treasury Select Committee to discuss the Independent Commission on Banking’s proposals today, he says raising equity tier one ratios beyond their current rate of 10% would present a risk to the economy.

Flint says that on the basis that HSBC’s capital base is £140bn, a further hike in capital requirements of 1% would take hundreds of billions of pounds of capacity out of lending.

He was responding to a question from a member of the Treasury Select Committee who asked where the banks need to be in terms of capital requirements in order to be safe for the public but still able to take risks and be profitable.

Recommended

Money Partners RMBS goes 34% into arrears

Three of Money Partners’ residential mortgage-backed securities tranches have over 34% of their book in arrears of 90 days or more. As of February 2011, Money Partners Securities 2 cumulative losses as a percentage of the original portfolio balance amounted to 4.1%, up from 1.5% in May 2008. Loans delinquent by more than 90 days, […]

Broker-exclusive fixes on offer at Northern Rock

Northern Rock has launched an intermediary-exclusive two-year fixed rate deal with no product fee at 3.34% up to 70% LTV. It is also offering a three-year fixed rate with no product fee at 3.99% up to 70% LTV and a five-year deal without a product fee at 4.49% up to 70% LTV.

Newsletter

News and expert analysis straight to your inbox

Sign up