HSBC to pay $765m US fine over conduct

LONDON: Britain’s Asia-focused bank HSBC on Monday revealed a $765-million US fine over the lender’s actions in the run-up to the subprime crisis, as it also logged rising first-half profits.

HSBC said it has agreed to pay the large US penalty over its conduct in residential mortgage-backed securities (RMBS), a type of investment derivative that bundled home loans into securities and was sold to investors before the 2008 financial meltdown.

“HSBC reached a settlement-in-principle to resolve the Department of Justice’s civil claims relating to its investigation of HSBC’s legacy RMBS origination and securitisation activities from 2005 to 2007,” the lender announced in a results statement.

“Under the terms of the settlement, HSBC will pay the DoJ a civil money penalty of $765m.”—AFP

Carrefour, Tesco seal purchasing deal

PARIS: Carrefour and Tesco, two of Europe’s largest retailers, said Monday they had finalised a purchasing alliance to increase their leverage with suppliers in the fiercely competitive supermarket sector.

The French and British supermarket giants said in a joint statement that they expect the alliance to become operational in October.

Tesco chief executive Dave Lewis said in June when the plan was announced that the alliance would enable the supermarket chains to “serve our customers even better, further improving choice, quality and value.”

While Tesco remains profitable and has seen rising sales, Carrefour posted a loss of $995 million in the first half of the year and is undertaking a cost cutting and restructuring programme to reduce its reliance on giant stores.—AFP

Shares in Linde plunge on merger snag

FRANKFURT: Linde shares plummeted Monday after the German industrial gases giant warned that its planned merger with US-based Praxair had run into a major hurdle, with US competition regulators unexpectedly pushing it to offload more assets.

Linde’s share price fell 9.1 per cent to 191.10 euros ($221) by 0820 GMT in Frankfurt, against a Dax blue-chip index down 0.36pc.

The slump came after Linde said at the weekend that new measures demanded by US regulators to ease competition concerns could exceed a “threshold” agreed with Praxair — potentially scuppering the deal.

The proposed tie-up would create the world’s largest industrial gases firm with annual revenues of more than $30 billion, overtaking Linde’s longtime French rival Air Liquide.

Antitrust authorities on both sides of the Atlantic are closely scrutinising the deal, and Linde said in a statement that efforts to win approval for the merger could be subject to requirements “more onerous than previously expected”.

Published in Dawn, August 7th, 2018