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HSBC Holdings plc (HSBC)

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19.84+0.13 (+0.66%)
At close: 4:00PM EDT

20.00 +0.16 (0.81%)
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Neutralpattern detected
Previous Close19.71
Bid19.91 x 4000
Ask19.95 x 21500
Day's Range19.75 - 20.09
52 Week Range17.95 - 39.69
Avg. Volume3,348,493
Market Cap81.026B
Beta (5Y Monthly)0.43
PE Ratio (TTM)N/A
EPS (TTM)-0.14
Earnings DateN/A
Forward Dividend & YieldN/A (N/A)
Ex-Dividend DateFeb 27, 2020
1y Target Est22.56
  • National security law: Hong Kong banks told by HKMA to report suspicious transactions
    South China Morning Post

    National security law: Hong Kong banks told by HKMA to report suspicious transactions

    Banks operating in Hong Kong have been told to report financial transactions believed to violate the city's controversial national security law (NSL) as they would suspected incidents of money laundering or terrorism financing, according to the city's top financial regulator.In a document posted on its website, the Hong Kong Monetary Authority (HKMA) advised banks to file suspicious transaction reports for dealings that may be related to violations of the national security law to the city's Joint Financial Intelligence Unit, an investigative division of the Hong Kong Police Force and the Customs & Excise Department."The obligation for reporting under the NSL will be triggered when an [authorised institution] 'knows' or 'suspects' that any property is offence-related property," the HKMA said in an updated frequently-asked-questions document on its website.Get the latest insights and analysis from our Global Impact newsletter on the big stories originating in China.The advice, updated on September 30, encourages banks to report those transactions as they would for suspected violations of the city's organised and serious crimes, drug trafficking, and anti-terrorism laws, according to the HKMA. The obligation would apply to both local and international banks in the city.The HKMA, which also acts as the city's de facto central bank, did not have an immediate comment when contacted on Tuesday.The Hong Kong Association of Banks, which drafted the frequently asked questions advice alongside the HKMA, also did not respond to a request for comment on Tuesday.The Financial Times reported the change earlier on Tuesday.Beijing adopted the national security law for the city on June 30, the day before the 23rd anniversary of the handover of Hong Kong and an annual march by opposition activists.The law targets acts of secession, subversion, terrorism and collusion with foreign forces and was adopted following months of anti-government protests in the city. Critics said the law infringes on freedoms guaranteed under the Basic Law, the citys' mini-constitution.Hong Kong national security law official English version:The national security law is the latest flashpoint between Washington and Beijing as relations between the world's two biggest economies become increasingly strained over a variety of issues, including technology and trade.The United States sanctioned 11 Hong Kong and mainland officials over the law in August and has threatened to sanction financial institutions that engage in "significant transactions" with individuals identified by the US as undermining the city's autonomy. China's foreign ministry vowed last week to enact its own "countermeasures" in response.Hong Kong chief executive Carrie Lam Cheng Yuet-ngor and other city leaders have argued the sweeping national security law is necessary and similar to efforts by other countries to fight terrorism. Lam is one of the officials sanctioned by the US over the law."All those countries which are pointing their fingers at China have their own national security legislation in place," Lam said in a video address defending the law's passage in June.International counterterrorism efforts by the United States and other countries have included enhanced reporting requirements for banks and other financial institutions regarding suspicious transactions that may be tied to terrorism financing, drug trafficking or money laundering activities.Police officers display a purple flag warning anti-government protesters in Causeway Bay on October 1 that they may be violating the city's controversial national security law. Photo: Sam Tsang alt=Police officers display a purple flag warning anti-government protesters in Causeway Bay on October 1 that they may be violating the city's controversial national security law. Photo: Sam TsangGlobal banks operating in Hong Kong must "carefully walk a tightrope" to avoid running afoul of US sanctions and not damaging their businesses in mainland China as the country further opens up its financial sector, according to Fitch Ratings.Not complying with US sanctions requests could threaten the ability of foreign banks to access the US financial system. At the same time, the national security law prohibits sanctions against mainland China or Hong Kong."So far, foreign banks do not appear to be deterred from maintaining operations in China or Hong Kong, and they continue to see growth opportunities in China, including from the Belt and Road initiative," Fitch analysts Monsur Hussain and Grace Wu said in a September 22 research note. "But this could expose them to reputational or conduct risks resulting in penalties from their home-country authorities if they are perceived to be helping clients evade sanctions and tariffs."The city's three currency-issuing lenders, Bank of China (Hong Kong), HSBC and Standard Chartered, did not respond or immediately have a comment for the story. American bank Citigroup, which also has a large retail operation in Hong Kong, declined to comment.A senior banking executive said earlier this year that the city's lenders would look to the HKMA for guidance if there is a discrepancy, and local rules would take precedence when dealing with customers in Hong Kong.In August, the HKMA said "unilateral sanctions" imposed by foreign governments that are not part of an international financial sanctions programme "have no legal status in Hong Kong", sparking confusion and anxiety among some members of the city's banking community."In assessing whether to continue to provide banking services to an individual or entity designated under a unilateral sanction which does not create an obligation under Hong Kong law, boards and senior management of [authorised institutions] should have particular regard to the treat customers fairly principles," the regulator said in the August 8 circular.As the threat of US sanctions loomed this year, some lenders in Hong Kong severed ties with blacklisted city officials or strengthened their review of any transactions going forward with those individuals and their families, according to people familiar with the matter.Lam herself said she is having trouble using her credit cards since the sanctions were announced, but called the situation a "meaningless" inconvenience. Commissioner of Police Chris Tang Ping-keung transferred his mortgage from HSBC to Bank of China (Hong Kong) days ahead of the sanctions designation.But that has not stopped international criticism of HSBC, Standard Chartered and other lenders who publicly supported the law earlier this year in the hopes that it would bring stability to an economy racked by months of protests and the coronavirus pandemic.Anti-government protesters detained by police officers on July 1 in Causeway Bay. Photo: Xiaomei Chen alt=Anti-government protesters detained by police officers on July 1 in Causeway Bay. Photo: Xiaomei ChenUS Secretary of State Mike Pompeo accused HSBC in August of maintaining banking relationships with individuals facing American sanctions "for denying Hongkongers' freedom', while cutting off access to others. He has not identified the individuals.HSBC declined to comment, but chief executive Noel Quinn previously said "we follow the laws and regulations of all of the countries in which we operate and will continue to do that,"The bank faced a separate backlash last year after it closed a bank account associated with Spark Alliance HK, which raised money via crowdfunding to help post bail for anti-government protesters.HSBC said at the time the corporate account was not being used for its stated purposed and it was closed in November 2019 "following a fund transfer instruction from the customer". Police later arrested four people on charges of suspected money laundering and froze about HK$70 million raised to support activists.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2020 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.

  • Money Laundering Detectives Have Been Out at the Pub

    Money Laundering Detectives Have Been Out at the Pub

    (Bloomberg Opinion) -- Why did it take media reporting to get Australia’s money laundering investigators to start looking into casino operator Crown Resorts Ltd.?Shares in the gambling company previously controlled by billionaire James Packer slumped 8.2% Monday after it said the country’s financial-crimes regulator Austrac had started a probe into the handling of “high risk and politically exposed” individuals at its Melbourne casino. The investigation started two months after Nine Entertainment Co. newspapers published a series of articles about the activities of high-rolling Chinese gamblers at Crown’s properties.It’s the latest in a string of prominent cases led by Austrac, after a A$45 million ($32 million) award against racetrack betting operator Tabcorp Holdings Ltd. in 2017, a A$700 million penalty against Commonwealth Bank of Australia in 2018, and a A$1.3 billion settlement with Westpac Banking Corp. last month.That’s quite a turnaround. For much of its 31-year history, Austrac has been a pretty somnolent organization, tending its ballooning database of suspicious transactions reported by compliance officers without carrying out much of the aggressive enforcement that you might expect. Just look back at the cases that Austrac has brought over the years. Until recently, the majority of actions involved nickel-and-dime businesses like a pub in southern Brisbane or a cafe in western Sydney.That’s clearly not going to do the job. Money laundering, by its nature, requires moving large volumes of either physical or digital cash. That means regulators need to be laser-focused on the activities of the companies that trade the largest volumes of those assets — casinos, in the case of notes and coins, and financial businesses, in the case of electronic transactions.“Until recently they were showing all the symptoms of a regulator who’d been captured by the industry they were supposed to regulate,” John Chevis, an independent anti-money laundering consultant, said by phone. The string of recent cases shows that things have at last started to change. Paul Jevtovic, a former police officer who took over at Austrac in 2014 before joining HSBC Plc’s compliance department in 2017, pushed the regulator toward a more proactive culture and kicked off the Tabcorp and the Commonwealth Bank investigations. Still, it’s clear that the agency is some way from being as aggressive as it should be. Last year’s media reports aren’t the first time that public accusations about money laundering breaches have been made against Crown. Independent legislator Andrew Wilkie in 2017 told parliament that casino staff exploited loopholes to avoid disclosing reportable transactions to Austrac (Crown denied the claims).Better funding and collaboration with other agencies would probably help. The number of suspicious transactions reported to Austrac has more than tripled over the past five years, but funding from government and its own paid-for activities is only up by about a third. As it is, the regulator’s relatively small staff is stretched to sort through all the information they’re receiving. Extracting legal penalties from large companies is even more expensive.Meanwhile, criminals aren’t standing still. The latest avenue for money laundering is probably over- and under-invoicing of traded goods, but that’s even harder to track. Unlike cash laundering, which involves a relatively small number of casinos and financial businesses, invoice-based laundering can take place between almost any two companies in the world.Austrac’s gradual shift toward a more active stance in recent years is welcome, but it will need to go still further. If you want to hunt rats, it’s no good hanging out in your kitchen. Going down into the sewers may be a thankless task, but it’s the only way to get the job done.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.David Fickling is a Bloomberg Opinion columnist covering commodities, as well as industrial and consumer companies. He has been a reporter for Bloomberg News, Dow Jones, the Wall Street Journal, the Financial Times and the Guardian.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

  • Alibaba Takes Over China’s Top Hypermart Chain for $3.6 Billion

    Alibaba Takes Over China’s Top Hypermart Chain for $3.6 Billion

    (Bloomberg) -- Alibaba Group Holding Ltd. will invest about $3.6 billion to double its stake in Sun Art Retail Group Ltd., taking control of China’s largest chain of hypermarts to try and fend off rivals like JD.com Inc. in e-commerce’s hottest growth arena.Alibaba will raise its direct and indirect stake in the grocery chain to about 72% by acquiring equity from Auchan Retail International SA, then make a general offer to shareholders to buy out the rest of Sun Art. The latter’s Hong Kong-listed stock leapt as much as 30% Monday, its biggest intraday gain since 2011. Alibaba gained as much as 1.8% to touch an intraday record.The deal signals the intention of Asia’s most valuable corporation to accelerate an effort to dominate one of Chinese e-commerce’s largest untapped frontiers. Alibaba Chief Executive Officer Daniel Zhang has made expansion into physical retail and the grocery business in particular a cornerstone of his growth strategy, an effort that paid off during the coronavirus pandemic. Sun Art already operates hundreds of hypermarkets across China under the Auchan and RT-Mart brands, a massive distribution and storage network that can supplement Alibaba’s own efforts in fresh produce.The Chinese e-commerce giant is now grappling with intensifying competition from the likes of JD, food delivery giant Meituan Dianping and startups such as Tencent Holdings Ltd.-backed Missfresh, all chasing a market for groceries and fresh produce that HSBC expects to grow 2.5 times to 690 billion yuan ($103 billion) by 2022 from 2019. Alibaba was among the pioneers in that arena, announcing in 2017 it would spend about $2.9 billion for a 36% stake of Sun Art.The deal “suggests that the tech giant seeks to further expand its one-hour home grocery delivery services such as Taoxianda, leveraging the grocer’s extensive offline hypermarts across China,” Bloomberg Intelligence analyst Kevin Kim said. “This could capture consumers flocking to online platforms, further induced by Covid-19 early this year, yet may hurt foot-traffic to the grocer’s physical stores.”Read more: Alibaba Touts Post-Virus Rebound While Watching ‘Fluid’ U.S.Read more: New Alibaba Chief Explains Why He Wants to Kill His Own BusinessZhang has been directly involved in the expansion into what the company calls its “new retail” strategy, combining e-commerce with physical stores. He helped launch a startup called Freshippo within Alibaba that aimed to combine a grocery store, a restaurant and a delivery app, a business that’s underpinned an overall new retail division that’s grown into a $12 billion operation, contributing a fifth of total revenue in the June quarter.As Alibaba increases its stake to a majority, Sun Art’s financial statements will be consolidated into the larger company’s. Peter Huang, Sun Art’s CEO, will add the title of chairman for the business.What Bloomberg Intelligence SaysAlibaba’s $3.6 billion investment to raise its stake in Sun Art to 72% from the 36% acquired in 2017 signals the company’s intention to strategically ramp up its supermarket retail services. The acquisition should boost its Taoxianda and Tmall Supermarket and help compete against JD.com, Meituan and Pinduoduo, which are also aggressively trying to push into fresh produce e-commerce.\- Vey-Sern Ling and Tiffany Tam, analystsClick here for the research.The online groceries segment has leapt to the forefront during Covid-19 when shoppers shunned restaurants and physical stores, though the industry -- which requires more complex logistical structures such as so-called cold chain storage -- has proven difficult to crack in years past.Alibaba’s initial moves into physical retail were closely followed by WeChat-operator Tencent, which has itself invested in brick-and-mortar chains such as Yonghui Superstores Co. JD now also operates its own thriving groceries business, while Meituan and up-and-comer Pinduoduo Inc. in recent years began investing aggressively in the arena.Sun Art is the industry leader in China’s hypermarkets, operating giant Costco- and Walmart-style stores that sell everything from seafood to wine and furniture under one roof. It held 14% of the market share in 2019, according to global intelligence firm Euromonitor International. Alibaba has also invested in many other brick-and-mortar retailers including Shanghai-listed Sanjiang Shopping Club Co., Shenzhen-listed New Huadu Supercenter Co., and Hong Kong-listed Lianhua Supermarket Holdings Co.Meanwhile, France’s Auchan has become the latest in a slew of foreign retailers to step back from China after struggling in the market. Last year, Carrefour SA sold an 80% stake in its China unit at a discount while German wholesaler Metro AG sold a majority stake in its operations there.Big box offerings are faring better. Costco Wholesale Corp. opened its first outlet in China last year to frenzied crowds and is planning its third store. Walmart Inc. plans to quadruple the number of its members-only warehouse chain Sam’s Club in China to 100 stores over the next eight years, as growth outpaces the company’s separate network of over 400 Walmart stores selling basic groceries.(Updates with Sun Art’s market share in 10th paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.