Hsbc to Raise $1.5 Billion in Perpetual Bonds as It Gears up for Loan Growth
HSBC Holdings plans to issue a total of US$1.5 billion in perpetual bonds, the third round of fundraising since June, in anticipation of rising demand for loans. The subordinated contingent convertible securities will be issued on Thursday and carry an interest rate of 6.95 per cent a year. HSBC intends to use the net proceeds from the sale of the securities for general corporate purposes and to maintain or further strengthen its capital base pursuant to requirements under the capital instruments regulations.
- This significant increase in perpetual bond issuance highlights the growing trend of banks seeking to tap into low-cost funding sources, which may have implications for regulatory oversight and market stability.
- Will HSBC's increased reliance on perpetual bonds lead to a shift away from traditional debt markets, potentially altering the bank's risk profile and impact on global financial markets?