Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

HSBC Holdings plc (ADR) (HSBC)’s bill for the Financial Crises: $550 million

HSBC Holdings plc (ADR) (NYSE:HSBC), the global banking and financial services institutions has settled with the Federal Housing Finance Agency for $550 million dollars. Bloomberg‘s Trish Regan reported the news on Street Smart.

Largest Financial Services Companies

 HSBC Holdings plc (ADR) (NYSE:HSBC), as we all know was not the first and perhaps not the last financial institution either to have picked up the bill for the 2007-2008 financial crises. In fact Trish reported that it was the 17th such institution. How many more are they going to be, still remains to be answered.

The fine was in direct connection to HSBC Holdings plc (ADR) (NYSE:HSBC)’s settlement of claims for the residential Mortgage Backed Securities (MBS). It is still unclear as to whether the damage caused by the bank was of equal or even less magnitude as the amount on its bill, namely $500 million portrays. What is even more baffling is the question that does this paltry sum, which might cast a dent in the financial institutions’ quarterly earnings or may be this year’s annual income,  monetize the social distress caused to families who had to evacuate their homes owing to foreclosures? FHFA certainly thinks that it does.

As details of HSBC Holdings plc (ADR) (NYSE:HSBC)’s extent of involvement remain undisclosed the amount of bill is the clue that can shed some light on this subject. To put things into context, JPMorgan Chase & Co. (NYSE:JPM) had settled for a far greater amount , almost ten times of HSBC Holdings plc (ADR) (NYSE:HSBC)’s bill, late last year.

FHFA’s crackdown certainly sends a reverberating message throughout the banking industry that irresponsible actions will not be forgiven and there will be consequences. It is another reason for  bankers not to get carried away in the moment and be critical of their actions. Financial institutions are central to our economy and standard of living. Lapse of judgement on their part could put all of us at risk.

Disclosure: none

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.