Big bank warns of trouble ahead
Friday 29th June, 2007
Big bank warns of trouble ahead
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BigNewsNetwork.com Friday 29th June, 2007
HSBC has warned the glut in global money credit combined with excessive leverage could send people to the wall if a big transaction finally goes wrong.
HSBC banking executives are uneasy after five years of low interest rates and the growing amounts of leverage in the financial system.
HSBC's first profit warning came earlier this year when the sub-prime mortgage market folded.
Last week Wall Street bank Bear Stearns was forced to bail out one of its hedge funds because of its heavy exposure to sub-prime mortgage investments.
Because risk is now so widely spread throughout the financial system, HSBC says large institutions could also fail.
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