![](http://investorshub.advfn.com/images/default_ih_profile2_4848.jpg?cb=0)
Thursday, June 25, 2009 1:53:57 PM
"Lehman mini-bonds buyback in HK
Published: 23 Jun 2009 08:02:01 PST
By Guo Lu
Bank of China Hong Kong (BOCHK) has announced that they will buy back Lehman mini-bonds from customers at 60 percent of their original cost, according to Monday’s Ming Pao Daily, a Hong Kong-based newspaper.
Lehman mini-bonds were issued by Lehman’s subsidiary company Pacific International Finance. Large banks sold the mini-bonds as part of a low-risk investment plan before Lehman Brothers’ went bankrupt. BOCHK was one of the major Hong Kong retailers of the mini-bonds.
Consumer groups have threatened several class actions against the major banks in Hong Kong, with many financial institutions hoping to mediate the issue before it lands them in court.
A spokeswoman from BOCHK told the Global Times yesterday that the bank had discussed the issue with the local authority, the Securities and Futures Commission (SFC), and had submitted a proposal regarding the matter.
BOCHK will offer customers a 60 percent buyback price with an additional 5 percent payable after Lehman’s liquidation, according to the news report.
Old-hand customers will receive an additional 10 percent.
Customers who purchased mini-bonds three to four years ago are eligible for a total 80 percent rebate, according to the newspaper report.
If the SFC passes the proposal, BOCHK will pay its customers a total HK$ 2.5 billion ($322.55 million) in losses, according to a Citibank report seen Monday.
The Citibank report stated that sales of Lehman mini-bond related financial derivatives by BOCHK totaled HK$ 4.2 billion ($541.88 million), accounting for 30 to 40 percent of all Lehman mini-bonds sold in Hong Kong.
The newspaper reported that SFC was still in negotiations with the BOCHK.
Neither the BOCHK nor SFC would comment on the negotiations when contacted by the Global Times yesterday.
Peter Chan, chairman of the Lehman Brothers Victims Alliance, told the Global Times Monday that BOCHK’s proposal was unfair to most investors and that banks should pay back all of the capital invested.
Chan estimated that losses from the mini-bonds amounted to HK$ 12.4 billion ($1.59 billion), citing calculations by the alliance’s attorneys. He said that around 15,000 customers of BOCHK would suffer losses.
One of the alliance’s officers, who just gave his family name as Lau, told the Global Times yesterday that the alliance would stage a massive protest on July 1 in Hong Kong to demand full compensation."
http://news.alibaba.com/article/detail/business-in-china/100122802-1-lehman-mini-bonds-buyback-hk.html
Glidelogic Corp. Becomes TikTok Shop Partner, Opening a New Chapter in E-commerce Services • GDLG • Jul 5, 2024 7:09 AM
Freedom Holdings Corporate Update; Announces Management Has Signed Letter of Intent • FHLD • Jul 3, 2024 9:00 AM
EWRC's 21 Moves Gaming Studios Moves to SONY Pictures Studios and Green Lights Development of a Third Upcoming Game • EWRC • Jul 2, 2024 8:00 AM
BNCM and DELEX Healthcare Group Announce Strategic Merger to Drive Expansion and Growth • BNCM • Jul 2, 2024 7:19 AM
NUBURU Announces Upcoming TV Interview Featuring CEO Brian Knaley on Fox Business, Bloomberg TV, and Newsmax TV as Sponsored Programming • BURU • Jul 1, 2024 1:57 PM
Mass Megawatts Announces $220,500 Debt Cancellation Agreement to Improve Financing and Sales of a New Product to be Announced on July 11 • MMMW • Jun 28, 2024 7:30 AM