HSBC: we do not need state aid

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HSBC yesterday rebuffed suggestions that it could be forced to go to the Government to shore up its capital.

Britain's biggest bank has been in the spotlight recently over the strength of its capital buffer after Morgan Stanley and other banking analysts said it might need to raise as much as $30bn to counter the slowing economy. There were also suggestions yesterday that HSBC and Barclays have to offer shares to pay fees for the Government's asset guarantee plan, giving the UK stakes in both banks.

The bank said: "HSBC has not sought capital support from the UK Government and cannot envisage circumstances where such action would be necessary. HSBC has long been one of the world's most strongly capitalised banks and is committed to maintaining this position."

The Government's outline terms for guaranteeing loans against future losses said payment for the insurance would be in cash or capital instruments but not ordinary shares. The Treasury said it would not rule out taking shares as payment, but did not plan to do so.

Banks are waiting to see the small print of the measures, which were broadly outlined yesterday. Royal Bank of Scotland, majority owned by the state, said it would use the guarantees but others said if the terms were too onerous they would not participate.

After RBS predicted a loss ahead of next month's results, HSBC said it would announce results on 2 March. HSBC has not ruled out raising capital. Its shares fell 6.5 per cent to 501p.