Feb 23, 2021

HSBC: spin off the UK bank

He should give serious consideration to spinning off a UK unit worth about £13bn. Quinn's plans for $6bn additional investment in Asia in coming years makes sense. HSBC wants to increase the percentage of group tangible equity to 50 per cent in the medium to long term, compared with 42 per cent last year. The UK loan book is conservatively managed, with a loan-to-deposit ratio of 85 per cent. Wholesale lending in Asia is double that of the UK. UK financial instruments classified as substandard and impaired are more than double the amount in Asia. HSBC shares trade at 0.6 times tangible book value, a steep discount to Asian peers such as Hang Seng Bank.

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