HSBC said to push Hang Seng Bank to offload soured property loans, Bloomberg reports

HSBC (0005) has unusually taken a direct role in pushing its Hong Kong unit Hang Seng Bank (0011) to sell a portfolio of troubled property loans, Bloomberg reported, citing people familiar with the matter.

About two months ago, HSBC instructed its global chief corporate credit officer and the head of its special credit unit to ensure Hang Seng began the disposal process, the report said. Hang Seng is now in the early stages of selling more than US$3 billion (HK$23.4 billion) of property-backed loans after its soured real estate debt in Hong Kong surged 85 percent year-on-year, according to the report.

As of June, the bank had about HK$25 billion of non-performing commercial property loans.

Hang Seng said it does not comment on specific reports and noted it manages credit risk under international regulations and accounting standards.

STAFF REPORTER