June 8 (Bloomberg) -- HSBC Holdings Plc’s U.S. securities division will no longer extend structured financing to hedge- fund investors to leverage their investments, according to people familiar with the company’s plans.
The bank is halting the financing by its structured-funds products division and eliminating an unspecified number of jobs in New York, said one of the people, who asked not to be identified because the information hasn’t been made public. The group reports to Steven Phan, global head of the investment access and solutions groups in London, the person said. Phan declined to comment.
“Hedge fund-linked strategies tie up a lot of capital because of the illiquidity of the underlying hedge fund,” said Keith Styrcula, chairman of the Structured Products Association, a New York-based industry group. “Those were among the very first lines of business that firms were cutting back on.”
Monday, June 08, 2009
Levered Fund of Funds Go The Way Of The Dodo - Delevering Continues Happily Plodding Along
HSBC today announces that they will stop providing financing for levered fund of funds. Deleveraging continues. Everything is fine at HSBC though, don't worry. Some pertinent sections from a Bloomberg article: