汇丰按新会计准则将SIV中的资产合并到资产负债表中

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HSBC Becomes First Bank
To Bail Out Troubled SIVs
By CARRICK MOLLENKAMP
November 27, 2007; Page C1

Worsening lending markets are prompting some of the world's biggest banks to take new action to rescue investment funds hit by the turmoil.

In a sign of the building pressure, United Kingdom banking giant HSBC Holdings PLC yesterday became the first bank to bail out specialized funds known as structured investment vehicles. HSBC plans to gradually shut down two bank-sponsored SIVs and take $45 billion in mortgage-backed securities and other assets owned by the funds onto its own balance sheet.

HSBC, with $2.15 trillion in assets, said the move would have little impact on its ability to lend or on its capital-adequacy ratio, a gauge of a bank's ability to absorb losses. HSBC already had sustained significant losses on subprime-mortgage investments in the U.S.

The company's decision highlights a growing concern among investors that banks will increasingly be forced to take responsibility for losses at funds that had once been viewed as safe. In recent weeks, managers of money-market funds, including Atlanta's SunTrust Banks Inc., have moved to insure investors against losses on the funds' investments in SIVs, which hold a total of $300 billion in securities.

Meanwhile, a group of the world's largest banks, led by Citigroup Inc., Bank of America Corp. and J.P. Morgan Chase & Co., are seeking to raise a "super fund" of as much as $100 billion that would buy assets from the SIVs to prevent a mass fire sale of assets.

SIVs have been in trouble since the summer, when the markets for short-term debt on which SIVs had depended all but dried up. After a brief revival, those markets have deteriorated further in recent weeks.

Throughout November, the bank "reached a fairly firm conclusion that the funding problems...in the broad SIV sector were not going to go away in the near term," said Pierre Goad, an HSBC spokesman.

HSBC shares fell 15.5 pence, or 1.9%, to 811.50 pence ($16.73) in London. Its American depositary shares slid $2.20, or 2.6%, to $82.54 in 4 p.m. New York Stock Exchange composite trading.

Efforts by HSBC to protect its SIVs are being watched closely by analysts and managers of money-market mutual funds, some of which have invested in debt issued by the two SIVs, called Cullinan Finance Ltd. and Asscher Finance Ltd. Janus Capital Group Inc. is estimated to have held about $606 million, or 2.7% of its money-market assets, in Cullinan and Asscher through the end of October, which has since been reduced. Federated Investors Inc. holds about $350 million in Asscher in its five largest money funds.

HSBC's move was viewed as a plus for firms such as these because it would help prevent a fire sale. "While this does not eliminate default risk to Federated and Janus, it does reduce or eliminate" the risk that the assets would be dumped into a market with few, if any buyers, said J.P. Morgan analyst Kenneth Worthington in a research note yesterday.

HSBC's move, particularly if followed by other banks, also may help relieve stress among SIVs by taking responsibility for a big chunk of the sector's assets. It reduces the risk "of the kind of distressed-SIV asset sale, which is kind of the nightmare scenario right now," says Antony Broadbent, a bank analyst at Sanford C. Bernstein in London. "It will be interesting to see if others do follow suit."

Germany's Dresdner Bank, a unit of Allianz SE, and the U.K.'s Standard Chartered PLC both operate large SIVs now being closely watched. Banks technically aren't required to rescue their SIVs, but they may risk harm to their reputation if they don't.

A Standard Chartered spokesman said yesterday that the managers of the Whistlejacket Capital Ltd. SIV are looking at alternative funding strategies. A Dresdner spokeswoman referred to Nov. 9 comments by Allianz, which said at the time there was no plan to bring assets held by Dresdner's SIV, K2 Corp., onto its balance sheet.

BMO Financial Group, whose Bank of Montreal unit is a sponsor of a SIVs called Links Finance Corp. and Parkland Finance Corp., is likely to provide an update today during its fourth-quarter report. A spokesman declined to comment.

First created in the late 1980s by Citigroup bankers in London, SIVs were until recently a booming business, issuing short-term commercial paper or medium-term notes and using the cash to buy higher-yielding assets ranging from bank debt to securities backed by U.S. mortgages.

But investors have shied from SIVs in recent months amid concerns about their holdings of subprime-mortgage securities. That has left them facing the prospect of selling assets to pay off maturing debt. According to an Oct. 15 Lehman Brothers report, $37 billion of medium-term notes will mature in the first quarter.

At the same time, many of the SIVs' holdings have fallen sharply in value -- a decline that in some cases can trigger requirements that force the funds to sell off their assets.

In a statement, HSBC said its move to rescue the two funds will "prevent funding constraints in the structured investment vehicle sector from forcing a liquidation of high-quality assets."

Cullinan Finance Ltd., which has $37 billion in assets, is the second-largest SIV after Sigma Finance Corp., an SIV operated by a nonbank firm in London called Gordian Knot Ltd. Asscher has $8 billion in assets.

Ratings agency Standard & Poor's said yesterday that its long-term AA-minus rating on HSBC is unaffected. The bank, S&P said, "has sufficient resources to absorb these additional obligations."

HSBC's Tier 1 capital ratio, a measure of a bank's regulatory capital strength, ranked high among its peers at 9.3% as of June 30. In a worst-case scenario -- the company essentially would have to fund the entire new structure -- that ratio would fall to about 9%.

HSBC's plan to rescue the two SIVs is complex. The company plans to set up at least one structure that, much like the planned super fund, will issue commercial paper or use HSBC's own funding to buy assets from the SIVs. The SIVs will use the money to pay down maturing commercial paper and medium-term notes.

Though details remain to be worked out with ratings agencies, HSBC says it believes that because the new structure will be backed by the bank, there won't be asset-value triggers.

HSBC's Mr. Goad said the firm had considered participating in the super fund, known as the Master-Liquidity Enhancement Conduit.

"M-LEC certainly has the potential to benefit the entire SIV sector," Mr. Goad said. "Our plan is not in any way meant as a criticism of the M-LEC proposal."