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HSBC hit with £57m fine over deposit protection

Business Jan 30, 2024 at 13:06

HSBC hit with £57m fine over deposit protection

A fine of £96m was avoided by the lender after it cooperated with the investigation, admitted early that some rules were broken and agreed to resolve the issue.

HSBC has been fined more than £57m for failing to protect consumer deposits.

The fine, totalling £57,417,500, has been levied by the the Bank of England’s Prudential Regulation Authority (PRA) for failing to protect consumer deposits from 2015 to 2022.

It’s the second highest fine ever applied by the regulator, reflecting the seriousness of the breaches, it said.

Under post-financial crash rules, deposits of up to £85,000 are safe in the event of a bank’s collapse under the Financial Services Compensation Scheme (FSCS).

The depositor protection failings were found to be so significant the PRA said it had “materially undermined” HSBC’s readiness for a restructuring.

Deposit protection rules require banks and building societies to put systems in place to create accurate information for the FSCS to rely on if a financial institution fails.