HSBC 2006 Annual Report Download - page 383

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If (i) any of the two issues of Preferred Securities are outstanding in November 2048 or April 2049, respectively,
or (ii) the total capital ratio of HSBC Bank on a solo and consolidated basis falls below the regulatory minimum
ratio required, or (iii) in view of the deteriorating financial condition of HSBC Bank, the Directors expect (ii) to
occur in the near term, then the Preferred Securities will be substituted by Preference Shares of HSBC Bank
having economic terms which are in all material respects equivalent to those of the Preferred Securities and the
guarantee taken together.
HSBC Holdings
2006 2005
US$m US$m
Subordinated liabilities:
– at amortised cost ......................................................................................................................... 8,423 5,236
– designated at fair value ............................................................................................................... 14,070 13,370
22,493 18,606
HSBC Holdings subordinated borrowings
Amounts falling due after
more than 1 year
2006
US$m
2005
US$m
Amounts owed to third parties
€2,000m Callable subordinated floating rate notes 20141 ................................................... 2,648 2,374
US$2,000m 6.5% subordinated notes 2036 .............................................................................. 2,056 –
US$1,400m 5.25% subordinated notes 2012 ............................................................................ 1,401 1,421
€1,000m 5.375% subordinated notes 2012 .......................................................................... 1,394 1,322
£650m 5.75% subordinated notes 2027 ............................................................................ 1,365 1,267
US$1,000m 7.5% subordinated notes 2009 .............................................................................. 1,088 1,115
€700m 3.625% callable subordinated notes 20202............................................................ 888 831
US$750m Callable subordinated floating rate note 20161 .................................................... 750 –
US$750m Callable subordinated floating rate notes 20151 ................................................... 749 749
£250m 9.875% subordinated bonds 20183........................................................................ 637 595
US$488m 7.625% subordinated notes 2032 .......................................................................... 609 482
€300m 5.5% subordinated notes 2009 .............................................................................. 418 390
US$222m 7.35% subordinated notes 2032 ............................................................................ 268 219
14,271 10,765
Amounts owed to HSBC undertakings
€1,400m 5.3687% fixed/floating subordinated notes 2043 –
HSBC Capital Funding (Euro 2) LP ..................................................................... 1,995 1,878
US$1,350m 9.547% subordinated step-up cumulative notes 2040 –
HSBC Capital Funding (Dollar 1) LP .................................................................. 1,332 1,331
US$1,250m 4.61% fixed/floating subordinated notes 2043 –
HSBC Capital Funding (Dollar 2) LP .................................................................. 1,187 1,185
€750m 5.13% fixed/floating subordinated notes 2044 –
HSBC Capital Funding (Euro 3) LP. .................................................................... 1,049 992
£500m 8.208% subordinated step-up cumulative notes 2040 –
HSBC Capital Funding (Sterling 1) LP ................................................................ 974 853
US$900m 10.176% subordinated step-up cumulative notes 2040 –
HSBC Capital Funding (Dollar 1) LP .................................................................. 900 900
€600m 8.03% subordinated step-up cumulative notes 2040 –
HSBC Capital Funding (Euro 1) LP ..................................................................... 785 702
8,222 7,841
22,493 18,606
1 The interest margins on the callable subordinated floating rate notes 2014, 2015 and 2016 increase by 0.5 per cent from September
2009, March 2010 and October 2011 respectively. The notes are repayable from their step up date at the option of the borrower, subject
to the prior consent of the Financial Services Authority.
2 The interest rate on the 3.625 per cent callable subordinated notes 2020 changes in June 2015 to become three-month EURIBOR plus
0.93 per cent. The notes may be redeemed at par from June 2015 at the option of the borrower, subject to the prior consent of the
Financial Services Authority.
3 The interest rate on the 9.875 per cent subordinated bonds 2018 changes in April 2013 to become the higher of (i) 9.875 per cent or (ii)
the sum of the yield on the relevant benchmark treasury stock plus 2.5 per cent. The bonds may be redeemed in April 2013 at par and
redemption has also been allowed from April 1998, subject to the prior consent of the Financial Services Authority, for an amount based
on the redemption yields of the relevant benchmark treasury stocks.