By Gareth Vaughan
The New Zealand arm of global banking giant HSBC is understood to be considering its first New Zealand bond issue in nearly three years.
HSBC raised NZ$300 million through a two-year retail bond issue in March 2006 and issued wholesale bonds in May 2006 and floating rate notes in August 2008. It's understood to now be considering a new bond issue, probably targeted at institutional investors.
An HSBC spokeswoman would only say the bank couldn't comment on market rumour or speculation.
The bank announced last week that Noel McNamara, currently head of commercial banking at HSBC in Australia, will replace David Griffiths as its New Zealand CEO from September 1.
HSBC's most recent General Disclosure Statement showed its mortgage book shrank in the December quarter by almost NZ$5 million. The bank, which targets wealthy customers with the lowest fixed mortgage rates advertised by any New Zealand bank, saw its residential mortgage book slip to NZ$981.4 million at December 31, down from NZ$986 million at September 30.
HSBC New Zealand's profit after tax for calendar year 2010 rose by NZ$5.5 million, or 11%, to NZ$56.2 million from NZ$50.7 million. The major contributor to the increase was a NZ$22.7 million, or 91%, jump in "other net operating income" to NZ$47.8 million.
This was boosted by a NZ$6.56 million, or 5%, rise in lending and credit facility fees to NZ$25.3 million, and NZ$12.1 million worth of "other commissions and fees" received from parent the Hongkong and Shanghai Banking Corporation Ltd compared with just NZ$415,000 in 2009.
HSBC's consideration of a local bond issue comes after Rabobank New Zealand recently issued NZ$100 million worth of seven-year bonds to retail investors and NZ$250 million in floating rate notes to institutional investors.
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