HSBC sees strong take up for rights issue

| April 5, 2009 | 0 Comments
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HSBC, which is Europe’s largest bank, said shareholders have bought 96.6% of the new shares offered in its £12.5 billion rights issue - the largest ever held in Britain.

The shares were offered at £2.54 each - a heavily discounted price from Friday’s close of £4.35 each. The remaining shares are expected to be sold on the open market.

The bank, which has so far rejected financial assistance from the Government, proceeded with the rights issue in a bid to strengthen its balance sheet and the bank said the funds will help it during the worst global recession in decades.

Furthermore, the bank said the cash call will bolster its core equity tier 1 ratio to around 8.5% and its tier 1 ratio to almost 10%.

HSBC chairman, Stephen Green, said: “We remain confident that HSBC is well-placed in today’s environment and that our strength leads to opportunity.”

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