Household HSBC Watch

HSBC Securities Services is known to be Lehman’s trustee across multiple jurisdictions, said Asian Investor. “The current crisis will no doubt put its trustee function to its most strenuous test to date. After multiple calls to various business heads of the group, no one has been able to respond to AsianInvestor’s question on what contingency plans HSBC has to recover assets for investors.” So what good is a trustee that doesn’t know what their position is? Hong Kong’s Securities & Futures Commission and Singapore’s Monetary Authority of Singapore say they are still working with the trustee, HSBC, to identify and price outstanding exposures to Lehman structured products.

When someone such as asian Investor asks a question intelligent people think there should be an answer, or a timeline for an answer. Silence suggests lack of a plan, or worse yet, a delaying tactic to let money flow to other accounts. Japan’s Financial Supervisory Authority has responded to the crisis with the most aggressive order in Asia to date. The FSC has issued an asset retention order to stop all capital outflows from Lehman’s accounts to offshore affiliates of Lehman or other financial institutions.

Yes, after multiple calls to various business heads of the group, no one has been able to respond. We knew Lehman was in trouble last weekend. News articles suggested bankruptcy or demise was imminent. HSBC has not responded, thus creating their own problems. You probably should have given up the golf games and social events in favor of doing your job and being prepared. When looking for a reliable trustee other institutions might remember this event.