For current investors of 0005 - how does this whole HSBC "bad bank" thing work?
Seen this on various aggregator sites and it has made its way to AAStock
HSBC Holdings HSBC, -1.01% HSBA, -0.92% is considering a potential merger of two of its biggest divisions, as well as the creation of a "bad bank" to house billions of dollars of unwanted assets and businesses, MarketWatch sister publication Financial News reported, citing unnamed people familiar with the situation. HSBC declined to comment to the outlet. The bad bank could house between $150 billion and $250 billion in assets, including global banking and markets assets, as well its French retail unit and Turkish operations, the report said.https://en.wikipedia.org/wiki/Bad_bankA bad bank is a corporate structure which isolates illiquid and high risk assets held by a bank or a financial organisation, or perhaps a group of banks or financial organisations.[1] A bank may accumulate a large portfolio of debts or other financial instruments which unexpectedly increase in risk, making it difficult for the bank to raise capital, for example through sales of bonds. In these circumstances, the bank may wish to segregate its "good" assets from its "bad" assets through the creation of a bad bank. The goal of the segregation is to allow investors to assess the bank's financial health with greater certainty.[1] A bad bank might be established by one bank or financial institution as part of a strategy to deal with a difficult financial situation, or by a government or some other official institution as part of an official response to financial problems across a number of institutions in the financial sector.