HSBC has been fined £57m by the Bank of England’s financial stability arm for failing to protect customer deposits in the event of a banking collapse. The Bank’s Prudential Regulation Authority said that the fine reflected the “seriousness” of the failings. The breaches took place between 2015 and 2022, with the bank failing to accurately identify deposits that were eligible for Financial Services Compensation Scheme (FSCS) protection. The PRA said that the bank’s failings had “materially undermined the firm’s readiness for resolution”. However, HSBC cooperated with the investigation and the fine was therefore reduced from £96.5m.
The PRA added that the bank failed to fulfill other rules regarding resolution processes and minimum disruption of critical services in the event of a banking collapse. In regard to HSBC Bank plc, the non-ringfenced part, 99% of eligible deposits were incorrectly marked as “ineligible” for FSCS protection. HSBC said that it was “pleased to have resolved this historic matter” and that it remained focused on serving its customers.
