FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a — 16 or 15d — 16 of

the Securities Exchange Act of 1934

For the month of March 2009

HSBC Holdings plc

42nd Floor, 8 Canada Square, London E14 5HQ, England

(Indicate by check mark whether the registrant files or will file annual reports under cover of
Form 20-F or Form 40-F).

Form 20-F þ Form 40-F o

(Indicate by check mark whether the registrant by furnishing the information contained in this Form
is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934).

Yes o No þ

(If “Yes” is marked, indicate below the file number assigned to the registrant in connection with
Rule 12g3-2(b): 82- ..).

 

 

 

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

 

If you are in any doubt as to any aspect of the proposals referred to in this document or as to the action you should take, you are recommended to seek your own financial advice immediately from your stockbroker, bank manager, solicitor, accountant, fund manager or other appropriate independent financial adviser, duly authorised under the Financial Services and Markets Act 2000 if you are resident in the United Kingdom, or, if you are not, from another appropriately authorised independent financial adviser.

 

If you have sold or otherwise transferred all your Ordinary Shares please send this document, together with the accompanying form of proxy, as soon as possible to the purchaser or transferee, or to the stockbroker, bank or other agent through whom the sale or transfer was effected, for onward delivery to the purchaser or transferee.

 

This document includes particulars given in compliance with the Hong Kong Listing Rules for the purpose of giving information with regard to the Company. Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this document, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this document. The Ordinary Shares trade under stock code 5 on The Stock Exchange of Hong Kong Limited.

 

Shareholders may at any time choose to receive corporate communications in printed form or to receive a notification of their availability on HSBC’s website. To receive future notifications of a corporate communication’s availability on HSBC’s website by email, or revoke or amend an instruction to receive such notifications by email, go to www.hsbc.com/ecomms. If you received a notification of this document’s availability on HSBC’s website and would like to receive a printed copy or would like to receive future corporate communications in printed form, please write to the appropriate Registrars at the address given below. Printed copies will be provided without charge. Further copies of this document and a Chinese translation of this and future documents may be obtained from the Registrars: Computershare Investor Services PLC, PO Box 1064, The Pavilions, Bridgwater Road, Bristol, BS99 3FA, United Kingdom; Computershare Hong Kong Investor Services Limited, Rooms 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong; or Corporate Shareholder Services, The Bank of Bermuda Limited, 6 Front Street, Hamilton HM 11, Bermuda.

 

 

 

 

HSBC Holdings plc

(Incorporated as a public limited company in England with registered number 617987)

 

Circular to Shareholders relating to a proposed 5 for 12 Rights Issue of 5,060,239,065 New Ordinary Shares at 254 pence each and a Notice of General Meeting

 

 

 

 

THIS DOCUMENT DOES NOT CONSTITUTE AN OFFER TO SELL, AN INVITATION TO INDUCE AN OFFER, OR A SOLICITATION OF AN OFFER TO ACQUIRE, THE NIL PAID RIGHTS, THE FULLY PAID RIGHTS OR THE NEW ORDINARY SHARES IN ANY JURISDICTION.

This is not a prospectus but a shareholder circular. The Prospectus containing details of the Rights Issue (including details of the Nil Paid Rights, the Fully Paid Rights and the New Ordinary Shares to be offered pursuant to the Rights Issue) will not be posted to Qualifying Shareholders but will be published on the Company’s website at www.hsbc.com on or around 17 March 2009, except that Qualifying Shareholders on the Hong Kong branch register (other than those who have agreed or are taken to have agreed to receive corporate communications by electronic means) will receive a printed copy of the Prospectus and Qualifying Shareholders and ADS Holders in the United States will receive a notice informing them how to access the US Prospectus electronically. Investors should read the Prospectus or the US Prospectus (as appropriate) for detailed information about the Rights Issue before deciding whether or not to invest in the Nil Paid Rights, Fully Paid Rights or New Ordinary Shares. Investors should not subscribe for any Nil Paid Rights, Fully Paid Rights or New Ordinary Shares referred to in this document except on the basis of the information, and the terms and conditions of the Rights Issue, contained in the Prospectus or the US Prospectus, as the case may be, and, in the case of Qualifying Non-CREST Shareholders, Qualifying Non-CCASS Shareholders and Qualifying Bermuda Shareholders only, the Provisional Allotment Letter. The distribution of this document and/or the form of proxy into any jurisdiction other than the United Kingdom, Hong Kong and Bermuda may be restricted by law. Persons into whose possession this document and/or the accompanying form of proxy comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.

 

Qualifying Euroclear Shareholders will be issued Euroclear Subscription Rights by Euroclear France. Euroclear Subscription Rights will not be admitted to listing or trading on Euronext Paris.

 

Notice of a general meeting of the Company to be held at 10.00 a.m. (UK time) on 19 March 2009 in the Platinum Suite, ExCel London, One Western Gateway, Royal Victoria Dock, London E16 1XL, United Kingdom is set out at the end of this document. A form of proxy for use at the General Meeting is enclosed and, to be valid, should be completed, signed and returned so as to be received by Computershare Investor Services PLC, PO Box 1064, The Pavilions, Bridgwater Road, Bristol, BS99 3FA, United Kingdom by no later than 10.00 a.m. (UK time) on 17 March 2009; by Computershare Hong Kong Investor Services Limited, Rooms 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Hong Kong by no later than 6.00 p.m. (Hong Kong time) on 17 March 2009; or by Corporate Shareholder Services, The Bank of Bermuda Limited, 6 Front Street, Hamilton HM 11, Bermuda by no later than 7.00 a.m. (Bermuda time) on 17 March 2009. Completion and return of a form of proxy will not prevent members from attending and voting in person should they wish to do so.

 

SUBJECT TO CERTAIN LIMITED EXCEPTIONS, THE RIGHTS ISSUE IS NOT BEING MADE TO SHAREHOLDERS OR INVESTORS IN ANY OF THE EXCLUDED TERRITORIES. There will be no offer or invitation to acquire, or any solicitation of any offer to acquire, Nil Paid Rights, Fully Paid Rights or New Ordinary Shares or to take up any entitlements to New Ordinary Shares in any jurisdiction in which such an offer or solicitation is unlawful. None of the Nil Paid Rights, the Fully Paid Rights, the Provisional Allotment Letter and the New Ordinary Shares will be registered under the securities laws of any of the Excluded Territories and none of the Nil Paid Rights, the Fully Paid Rights, the Provisional Allotment Letter or the New Ordinary Shares will qualify for distribution under any of the relevant securities laws of the Excluded Territories (other than pursuant to any applicable exceptions as agreed with the Company and certain of the Banks). Accordingly, none of the Nil Paid Rights, the Fully Paid Rights, the Provisional Allotment Letter and the New Ordinary Shares may be offered, sold, pledged, taken up, exercised, resold, renounced, transferred or delivered, directly or indirectly, into or within any of the Excluded Territories (other than pursuant to any applicable exceptions as agreed with the Company and certain of the Banks).

 

The Nil Paid Rights, the Fully Paid Rights and the New Ordinary Shares have not been approved or disapproved by the SEC, any state securities commission in the United States or any other US regulatory authority, nor have any of the foregoing authorities passed upon or endorsed the merits of the offering of the Nil Paid Rights, the Fully Paid Rights or the New Ordinary Shares or the accuracy or adequacy of this document. Any representation to the contrary is a criminal offence in the United States.

 

This document shall not constitute an offer to sell or the solicitation of an offer to buy securities, nor shall there be any sale of securities referred to in this document, in any jurisdiction, including the United States, in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. Securities may not be offered or sold in the United States absent registration under the US Securities Act of 1933, as amended, or an exemption from registration.

 

This document does not constitute a prospectus or an extract from, or a summary or abridged version of, a prospectus in connection with an offering of securities of the Company. Investors must neither accept any offer for, nor acquire, any securities to which this document refers, unless they do so on the basis of the information contained in the Prospectus or the US Prospectus (as appropriate) published by the Company. This document does not

constitute an offer to sell, an invitation to induce an offer or the solicitation of an offer to acquire, any securities and cannot be relied upon for any investment contract or decision.

 

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

 

This document and the documents incorporated by reference herein contain certain forward-looking statements with respect to the financial condition, results of operations and business of HSBC.

 

Statements that are not historical facts, including statements about HSBC’s beliefs and expectations, are forward-looking statements. Words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “potential” and “reasonably possible”, variations of these words and similar expressions are intended to identify forward-looking statements. These statements are based on current plans, estimates and projections, and therefore undue reliance should not be placed on them. Forward-looking statements speak only as of the date they are made and it should not be assumed that they have been revised or updated in the light of new information or future events.

 

Forward-looking statements involve inherent risks and uncertainties. You are cautioned that a number of factors could cause actual results to differ, in some instances materially, from those anticipated or implied in any forward-looking statement. These factors include, among others:

 

Changes in general economic conditions in the markets in which HSBC operates, such as:

 

 

Changes in government policy and regulation, including:

 

 

Factors specific to HSBC:

 

 

In light of these risks, uncertainties and assumptions, the forward-looking events discussed herein might not occur. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of their dates. Subject to any applicable legal and/or regulatory requirements, HSBC undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

 

Exchange rate

 

For the purposes of this document, unless otherwise specified, any amounts converted into US$ were calculated by reference to the £ : US$ exchange rate of £1 : US$1.42145 at approximately 3.00 p.m. on 27 February 2009 (being the last Business Day prior to the Rights Issue Announcement) as published by Bloomberg and any amounts converted into HK$ were calculated by reference to the £ : HK$ exchange rate of £1 : HK$11.0236 at approximately 3.00 p.m. on 27 February 2009 (being the last Business Day prior to the Rights Issue Announcement) as published by Bloomberg.

 

Currency

 

In this document, all references to: (i) “sterling”, “pounds sterling”, “£” or “pence” are to the lawful currency of the United Kingdom; (ii) “US dollars” or “US$” are to the lawful currency of the United States of America; and (iii) “Hong Kong dollars” or “HK$” are to the lawful currency of Hong Kong.

 

Timetables

 

Expected timetables of events relating to the Rights Issue in the UK, Hong Kong and Bermuda are set out on pages 6, 7 and 8 respectively. Unless otherwise stated, references to time contained in this document are to UK time.

 

TABLE OF CONTENTS

 

 

 

Access to the Meeting

 

The Platinum Suite, ExCel London, is wheelchair accessible, the auditorium is fitted with an induction loop, and parking spaces are available for disabled drivers. To help us ensure the General Meeting is fully accessible to all Shareholders, please contact Jenny Varley (tel +44 (0)20 7992 3889, fax +44 (0)20 7991 4883, e-mail jenny.varley@hsbc.com) if you have any particular access or other needs.

 

The Notice of General Meeting is available on our website, www.hsbc.com.

EXPECTED TIMETABLE OF PRINCIPAL EVENTS IN THE UK

 

EXPECTED TIMETABLE OF PRINCIPAL EVENTS IN HONG KONG

 

EXPECTED TIMETABLE OF PRINCIPAL EVENTS IN BERMUDA

 

Notes to the preceding timetables:

 

 

 

 

3 March 2009

 

Dear Shareholder

 

Proposed 5 for 12 Rights Issue of 5,060,239,065 New Ordinary Shares at 254 pence each

 

 

On 2 March 2009, HSBC announced that it proposes to raise approximately £12.5 billion (US$17.7 billion) (net of expenses) by way of a fully underwritten Rights Issue of 5,060,239,065 New Ordinary Shares at 254 pence per share on the basis of 5 New Ordinary Shares for every 12 Existing Ordinary Shares. A copy of that announcement can be viewed at www.hsbc.com/investor-relations. The Company also published its results for the financial year ended 31 December 2008 on 2 March 2009. The results announcement and the Annual Report and Accounts for the financial year ended 31 December 2008 can be viewed at www.hsbc.com/investor-relations.

 

The Rights Issue is conditional upon, amongst other things, Shareholders’ approval of an increase in the Company’s authorised share capital to create sufficient Ordinary Shares for the Rights Issue and the Shareholders granting authority to the Directors to allot and issue the New Ordinary Shares at the General Meeting.

 

The purpose of this document is to provide Shareholders with details of the Rights Issue and notice of a general meeting of the Company to consider and, if thought fit, pass the resolutions required to authorise the Company to carry out the Rights Issue.

 

 

HSBC has long maintained a culture of responsibility and conservative risk management which have combined to produce a strong financial position which has enabled it to create valued long-term relationships with customers. These fundamental beliefs are deeply rooted in our character. The key elements of financial strength are a strong capital base coupled with sustainable and stable funding sources, and in particular a strong and growing deposit base. Those strengths have served us well over the years. Today HSBC is well capitalised, liquid and profitable. Our capital strength is supported by a conservative balance sheet characterised by an advances to deposits ratio of 83.6 per cent as at 31 December 2008 and a core funding base that continues to grow.

 

We are however today facing unprecedented turmoil in the economic and financial environment, with major uncertainties ahead. The current global economic downturn, combined with extreme volatility in financial markets, means that the financial system remains under stress. Over the past 12 months, many of our competitors have received significant government capital injections or have raised capital from shareholders and other investors. Higher regulatory capital requirements, in part from the effect of the economic downturn on capital requirements under the Basel II regime, as well as changing market sentiment on appropriate levels of leverage, have also raised expectations regarding capital levels. While we have maintained strong capital ratios, we are now raising the top of our target range for the tier 1 ratio so that the range will be from 7.5 per cent to 10 per cent. The Rights Issue will add 150 basis points to our capital ratios, strengthening the core equity tier 1 ratio to 8.5 per cent and the tier 1 ratio to 9.8 per cent, in each case on a pro forma basis as at 31 December 2008. We are determined that HSBC should maintain its signature financial strength.

 

We are continuing to manage the capital allocation within the HSBC Group to concentrate on our core emerging markets and faster growing businesses. In light of continuing losses from our US consumer finance business, yesterday we announced further actions in the US to restructure our operations and to put into run off all of our branch-based consumer lending operations, which are branded “HFC” and “Beneficial”. We have also closed down most of our structured credit and mortgage-backed securities distribution operations. Outside the US, during 2008 we have sold certain businesses that are not core to our strategy, such as our French regional banks.

 

HSBC Holdings plc

Incorporated in England with limited liability. Registered in England: number 617987

Registered Office and Group Management Office:

8 Canada Square, London E14 5HQ, United Kingdom

We remain confident that HSBC is well-placed in today’s environment and that our strength leads to opportunity. Our strategy has served HSBC well and positions it for long-term growth with attractive returns. We continue to combine our position as the world’s leading emerging markets bank with an extensive international network across both developed and faster growing markets. At the same time, as the financial system exhibits stress, our competitive position is improving as the capacity and capabilities of financial institutions are constrained by lack of capital and funding; many of them are also focusing more on their respective domestic markets.

 

Planned internal capital generation remains strong and this capital raising will enhance our ability to deal with the impact of an uncertain economic environment and to respond to unforeseen events. Importantly, it will also give us options regarding opportunities which we believe will present themselves to those with superior financial strength. These may involve organic investment in the continued taking of market share from more capital constrained competitors. There may also be opportunities to grow through targeted acquisitions, by taking advantage of attractive valuations where the opportunities in question align with our strategy and the risks are understood.

 

As explained below, the Directors have rebased the envisaged dividend per share, for the first three interim dividends in respect of 2009, to reflect the impact of the enlarged ordinary share capital resulting from the Rights Issue, prevailing business conditions and capital requirements. Until the end of 2007, HSBC had grown its dividend per share by 10 per cent or more every year for 15 years, reflecting the strong growth and shareholder returns that the Company has delivered. For 2009, the Directors have carefully considered HSBC’s dividend payments in view of the Company’s desire to retain its absolute and relative position of capital strength. The current challenges that have left much of the wider financial services sector unable to support cash returns to shareholders have also been factored into this consideration.

 

The dividend payments envisaged remain substantial and reflect management’s long-term confidence in the business. However, they also move the Company to a more conservative position to reflect the uncertain current environment and to retain more capital within the business. HSBC will continue to aim to pay progressive dividends in line with the long-term growth of the business.

 

During a period of global financial turmoil, our business model, the broad base of our earnings, our distinctive character and our brand mean that we remain one of the strongest international banks.

 

Your Board believes that the Rights Issue is in the best interests of Shareholders, helping us strengthen our competitive positioning so that we can better deliver sustained value over time.

 

 

Pursuant to the Rights Issue, the Company is proposing to offer New Ordinary Shares by way of rights to all Qualifying Shareholders (other than, subject to certain exceptions as agreed with the Company and certain of the Banks, Qualifying Shareholders with registered addresses in any of the Excluded Territories) on the following basis:

 

5 New Ordinary Shares for every 12 Existing Ordinary Shares

 

held and registered in their name on the Record Date. Entitlements to New Ordinary Shares will be rounded down to the nearest whole number. Fractions of New Ordinary Shares will not be allotted to Qualifying Shareholders but will be aggregated and sold in the market for the benefit of the Company. ADS Holders will also be able to participate in the Rights Issue.

 

The Issue Price for Shareholders on the UK principal register is 254 pence per New Ordinary Share. The Issue Price for Shareholders on the Hong Kong branch register is HK$28.00 per New Ordinary Share, which was calculated by reference to the £ : HK$ exchange rate of £1 : HK$11.0236 at approximately 3.00 p.m. (UK time) on 27 February 2009 as published by Bloomberg. The Issue Price for Shareholders on the Bermuda branch register is US$3.61 per New Ordinary Share, which was calculated by reference to the £ : US$ exchange rate of £1 : US$1.42145 at approximately 3.00 p.m. (UK time) on 27 February 2009 as published by Bloomberg.

 

The Issue Price for Shareholders on the UK principal register of 254 pence per New Ordinary Share represents a discount of approximately 47.5 per cent to the Closing Price of an Ordinary Share of 484.21 pence on 27 February 2009 (being the last Business Day prior to the Rights Issue Announcement) and a 39.0 per cent discount to the theoretical ex-rights price based on that Closing Price, in each case adjusted for the fact that the New Ordinary Shares will not rank for the fourth interim dividend in respect of the financial year ended 31 December 2008 of US$0.10 per Ordinary Share. The unadjusted Closing Price of an Ordinary Share on 27 February 2009 was 491.25 pence.

 

The Issue Price for Shareholders on the Hong Kong branch register of HK$28.00 per New Ordinary Share represents a discount of approximately 50.2 per cent to the closing price on the Hong Kong Stock Exchange of an

Ordinary Share of HK$56.17 on 27 February 2009 (being the last Business Day prior to the Rights Issue Announcement), adjusted for the fact that the New Ordinary Shares will not rank for the fourth interim dividend in respect of the financial year ended 31 December 2008 of US$0.10 per Ordinary Share. The unadjusted closing price on the Hong Kong Stock Exchange of an Ordinary Share on 27 February 2009 was HK$56.95.

 

The completion of the Rights Issue will result in 5,060,239,065 New Ordinary Shares being issued (representing approximately 41.7 per cent of the existing issued ordinary share capital of the Company as at 27 February 2009 (being the latest practicable date prior to the publication of this document) and 29.4 per cent of the Enlarged Share Capital immediately following completion of the Rights Issue). Qualifying Shareholders who take up their pro rata entitlement in full will suffer no dilution to their interests in the Company. If a Qualifying Shareholder does not take up any of his/her entitlement under the Rights Issue, his/her proportionate shareholding will be diluted by 29.4 per cent.

 

The Rights Issue is conditional, amongst other things, upon:

 

 

The New Ordinary Shares (nil paid) will be provisionally allotted to all Qualifying Shareholders on 19 March 2009. The provisional allotment is expected to be confirmed on 6 April 2009 and those Qualifying Shareholders entitled to New Ordinary Shares are expected to be entered on the Company’s register of members on 6 April 2009.

 

Holdings of Existing Ordinary Shares in certificated and uncertificated form or on different registers of members will be treated as separate holdings to calculate entitlements under the Rights Issue.

 

The New Ordinary Shares, when issued and fully paid, will rank for all dividends declared, made or paid after the date of allotment and issue of the New Ordinary Shares (except in respect of the fourth interim dividend of US$0.10 per Ordinary Share for the financial year ended 31 December 2008 declared by the Company on 2 March 2009, as the New Ordinary Shares are being issued after the record date for this dividend) and otherwise pari passu with the Existing Ordinary Shares. The New Ordinary Shares, when issued, will be in registered form and will be capable of being held in certificated form and in uncertificated form through CREST or CCASS.

 

The Rights Issue is fully underwritten by the Underwriters pursuant to the Underwriting Agreement.

 

Applications will be made to the UK Listing Authority and to the London Stock Exchange for the New Ordinary Shares (nil and fully paid) to be admitted to the Official List and to trading on the London Stock Exchange’s main market for listed securities respectively, to the Hong Kong Stock Exchange for listing of, and permission to deal in, the New Ordinary Shares (nil and fully paid) on the Main Board of the Hong Kong Stock Exchange, and to the New York Stock Exchange, Euronext Paris and the Bermuda Stock Exchange for listing of the New Ordinary Shares (fully paid). Application will also be made for the ADSs representing New Ordinary Shares to be listed and traded on the New York Stock Exchange. It is expected that UK Admission will become effective and that dealings in the New Ordinary Shares, nil paid, will commence on the London Stock Exchange at 8.00 a.m. on 20 March 2009. It is also expected that HK Admission will become effective at 9.30 a.m. (Hong Kong time) on 20 March 2009 and that dealings in the New Ordinary Shares, nil paid, will commence on the Main Board of the Hong Kong Stock Exchange at 9.30 a.m. (Hong Kong time) on 23 March 2009.

 

The full terms of the Rights Issue, including the procedure for acceptance and payment and the procedure in respect of rights not taken up, will be set out in the Prospectus and, in the case of Qualifying Non-CREST Shareholders, Qualifying Non-CCASS Shareholders and Qualifying Bermuda Shareholders, in the Provisional Allotment Letter.

 

4   Financial impact of the Rights Issue

 

As at 31 December 2008, HSBC’s core equity tier 1 ratio was 7.0 per cent and its tier 1 ratio was 8.3 per cent. Adjusting for the proceeds of the Rights Issue, the core equity tier 1 ratio and tier 1 ratio would have been approximately 8.5 per cent and 9.8 per cent, respectively, on a pro forma basis as at 31 December 2008. HSBC is now raising the top of its target range for the tier 1 ratio so that the range will be from 7.5 per cent to 10 per cent.

 

5   Structure of the Rights Issue

 

The Rights Issue has been structured in a way that is expected to have the effect of creating distributable reserves approximately equal to the net proceeds of the Rights Issue less the par value of the New Ordinary Shares issued by the Company. Provided that certain conditions are met, the proceeds of the Rights Issue (after the deduction of certain agreed fees, costs and expenses) will be applied by the Receiving Agent on behalf of the Bank Subscriber to subscribe for redeemable preference shares in Newco, which is a Jersey company owned by the Company and the Bank Subscriber.

 

The Company will allot and issue the New Ordinary Shares to those persons entitled thereto in consideration of the Bank Subscriber transferring its holdings of ordinary shares and redeemable preference shares in Newco to the Company. Accordingly, instead of receiving cash as consideration for the issue of the New Ordinary Shares, the Company will own the entire issued share capital of Newco whose only asset will be cash reserves, equal to the net proceeds of the Rights Issue. The Company will be able to redeem the redeemable preference shares in Newco in order to access these funds and, during any interim period prior to redemption, by procuring that Newco lends those funds to the Company.

 

The Company may elect to implement the Rights Issue without using the structure described above if it deems it to be in the Company’s interests to do so.

 

6   Overseas Shareholders

 

New Ordinary Shares will be provisionally allotted (nil paid) to all Qualifying Shareholders, including Qualifying Shareholders with registered addresses in any of the Excluded Territories. However, subject to certain exceptions as agreed with the Company and certain of the Banks, Provisional Allotment Letters will not be sent to Qualifying Non-CREST Shareholders, Qualifying Non-CCASS Shareholders or Qualifying Bermuda Shareholders with registered addresses in, or who are otherwise known to the Company to be residents of, any of the Excluded Territories, nor will the CREST stock accounts of Qualifying CREST Shareholders with registered addresses in, or the CCASS stock accounts of Qualifying CCASS Shareholders with addresses in, or in either case who are otherwise known to the Company to be residents of, any of the Excluded Territories, be credited with Nil Paid Rights. Such Qualifying Shareholders who therefore cannot take up the New Ordinary Shares provisionally allotted to them will be treated in the same way as all other Qualifying Shareholders who do not take up the New Ordinary Shares provisionally allotted to them.

 

Qualifying Euroclear Shareholders will be issued Euroclear Subscription Rights by Euroclear France and will receive one Euroclear Subscription Right for each Euroclear Interest held at the close of business (Central European time) on Euronext Paris on the Record Date. Euroclear Subscription Rights exist only within the systems of, and are issued by, Euroclear France. They evidence Nil Paid Rights held in CREST for the benefit of Euroclear France. Euroclear Subscription Rights will not be admitted to listing or trading on Euronext Paris.

 

7   Dividends

 

The Directors have declared a fourth interim dividend for 2008 of US$0.10 per Ordinary Share (in lieu of a final dividend) which, together with the first three interim dividends for 2008 of US$0.18 per Ordinary Share already paid, will make a total distribution in respect of the year of US$0.64 per Ordinary Share. The aggregate dividend payments per Ordinary Share for 2008 represent a decrease of 29 per cent in US$ terms and 15 per cent in sterling terms from the aggregate dividend payments in respect of 2007. The fourth interim dividend for 2008 will be payable on 6 May 2009, with a scrip dividend alternative, to Shareholders on the register on 20 March 2009. As the record date for this dividend is 20 March 2009, the New Ordinary Shares, when issued on 6 April 2009, will not rank for this dividend.

 

The Board intends to continue to pay quarterly interim dividends on the Ordinary Shares, with a pattern of three equal interim dividends with a variable fourth interim dividend. The level of dividends per Ordinary Share in future while reflecting the long-term growth of HSBC’s business will depend upon, among other things, expected future earnings, prevailing business conditions and capital requirements. It is envisaged that the first interim dividend in respect of 2009 will be US$0.08 per Ordinary Share. The Board has rebased the envisaged dividend per share for the first three interim dividends in respect of 2009 to reflect the impact of the foregoing factors and the impact of the enlarged ordinary share capital resulting from the Rights Issue.

8   Current trading and prospects

 

On 2 March 2009, HSBC published its Annual Report and Accounts for the financial year ended 31 December 2008 which can be viewed at www.hsbc.com/investor-relations. Business performance in January 2009 has been strong and ahead of HSBC’s expectations.

 

9   HSBC Share Plans

 

The options and awards granted under the HSBC Share Plans (other than the Share Ownership Plan) may be adjusted by the Company as a result of the Rights Issue in accordance with the rules of the relevant plan. Any such adjustments will be subject, where appropriate, to approval from HM Revenue & Customs or the Irish Revenue Commissioners and a report from the Company’s auditors that such proposed adjustments are fair and reasonable. Participants will be contacted separately with further information on how their options and/or awards may be affected by the Rights Issue.

 

Participants in the Share Ownership Plan will be contacted separately about their rights under the Rights Issue.

 

10   General Meeting

 

Completion of the Rights Issue is conditional upon Shareholders’ approval of the Resolutions (without material amendment) being obtained at the General Meeting. The General Meeting will be held at 10.00 a.m. on 19 March 2009 in the Platinum Suite, ExCel London, One Western Gateway, Royal Victoria Dock, London E16 1XL, United Kingdom.

 

Summary and explanation of the proposed Resolutions

 

A summary and explanation of the Resolutions to be proposed at the General Meeting is set out below. Please note that these are not the full text of the Resolutions and you should read this section in conjunction with the full text of the Resolutions contained in the Notice at the end of this document.

 

Resolution 1 — To increase the Company’s authorised ordinary share capital

 

Resolution 1 will increase the Company’s authorised share capital by the creation of a further 6,000,000,000 Ordinary Shares (which represents an increase of approximately 40.0 per cent in the authorised ordinary share capital of the Company). This will create additional ordinary share capital to be issued in part under the Rights Issue and to allow the Company to retain authorised, but unissued, ordinary share capital for general purposes following the Rights Issue.

 

Resolution 2 — To give the Directors the authority to allot the New Ordinary Shares in connection with the Rights Issue

 

Resolution 2 will grant the Directors authority to allot the New Ordinary Shares for the purposes of the Rights Issue pursuant to section 80 of the UK Companies Act 1985. The maximum aggregate nominal amount of ordinary share capital which the Directors would have authority to allot pursuant to Resolution 2 is US$2,530,200,000 which represents approximately 41.7 per cent of the total issued ordinary share capital of the Company as at 27 February 2009 (being the latest practicable date prior to the publication of this document). Assuming the Rights Issue takes place, the maximum aggregate amount of ordinary share capital which the Directors would have authority to allot pursuant to the allotment authority granted by the Shareholders at the Annual General Meeting held in 2008 would represent an amount equal to approximately 13.2 per cent of the Enlarged Share Capital. As at 27 February 2009 (being the latest practicable date prior to the publication of this document), the Company did not hold any treasury shares.

 

The Directors intend to use the authority given by Resolution 2 to allot the New Ordinary Shares in connection with the Rights Issue and for no other purpose. This authority will expire at the conclusion of the Company’s Annual General Meeting in 2009.

 

Resolution 3 — To disapply pre-emption rights, where necessary, in connection with the Rights Issue

 

Resolution 3, which will be proposed as a special resolution, will give the Directors authority to allot on a non-pre-emptive basis, where necessary, the New Ordinary Shares to be allotted pursuant to Resolution 2 for the purposes of the Rights Issue, including subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or securities represented by depositary receipts or having regard to any restrictions, obligations or legal problems under the laws or the requirements of any territory.

The maximum aggregate nominal amount of ordinary share capital which the Directors would have authority to allot pursuant to Resolution 3 is US$2,530,200,000 which represents approximately 41.7 per cent of the total issued ordinary share capital of the Company as at 27 February 2009 (being the latest practicable date prior to the publication of this document).

 

11   Action to be taken in respect of the General Meeting

 

A form of proxy is enclosed (and is available at www.hsbc.com/proxy) for use at the General Meeting. Whether or not you propose to attend the General Meeting, you are requested to complete and submit a form of proxy in accordance with the instructions on the form of proxy. The form of proxy must be received not less than 48 hours before the time of the holding of the General Meeting (or any adjourned meeting). The completion and submission of a form of proxy will not preclude a Shareholder from attending and voting in person at the General Meeting. Shareholders with internet access may submit their form of proxy electronically, at www.hsbc.com/proxy by entering their Shareholder Reference Number and the Personal Identification Number which is either printed on their form of proxy or which has been sent to them by email if they have registered an email address to receive electronic communications. For Ordinary Shares held through CREST, proxy appointments may be submitted via the CREST proxy voting system.

 

If you are a Qualifying Euroclear Shareholder, you will need to return the form of direction issued to you by your Admitted Institution by the time and date indicated to you by your Admitted Institution. The latest time and date for giving instructions to your Admitted Institution may be set earlier than the time provided for the return of forms of proxy to the Registrars.

 

12   Intentions of the Directors

 

The Directors who are entitled to acquire New Ordinary Shares under the Rights Issue intend to take up in full their rights to acquire New Ordinary Shares, other than the rights arising in connection with any Ordinary Shares the executive Directors hold through the Share Ownership Plan. In accordance with the basis on which the Share Ownership Plan operates, the trustees of the plan will sell such number of those rights during the nil paid dealing period as will meet the cost of taking up the balance of such rights.

 

13   Board recommendation to the Shareholders

 

The Board considers that the Rights Issue and the Resolutions are in the best interests of the Company and its Shareholders as a whole and accordingly the Board unanimously recommends to Shareholders that they vote in favour of the Resolutions, as the Directors intend to do in respect of their own beneficial holdings of Ordinary Shares.

 

Yours sincerely

 

S K Green

Group Chairman

DEFINITIONS AND INTERPRETATION

 

The definitions set out below apply throughout this document, unless the context requires otherwise.

 

 

 

 

 

HSBC Holdings plc
Notice of General Meeting

 

Notice is hereby given that a General Meeting of the Company will be held in the Platinum Suite, ExCel London, One Western Gateway, Royal Victoria Dock, London E16 1XL, United Kingdom on Thursday 19 March 2009 at 10.00 a.m. to consider and (if thought fit) pass the following Resolutions of which Resolutions 1 and 2 will be proposed as Ordinary Resolutions and Resolution 3 will be proposed as a Special Resolution:

 

 

By Order of the Board

 

R G Barber

 

 

HSBC Holdings plc

Incorporated in England with limited liability. Registered in England: number 617987

Registered Office and Group Management Office:

8 Canada Square, London E14 5HQ, United Kingdom

 

Notes:

 

 

The issued share capital of the Company with voting rights on 27 February 2009, being the latest practicable date prior to the publication of this document, was 12,144,573,757 ordinary shares of US$0.50 each.

 

 

The right to appoint a proxy does not apply to persons whose shares are held on their behalf by another person and who have been nominated to receive communications from HSBC in accordance with section 146 of the UK Companies Act 2006 (“nominated persons”). Nominated persons may have a right under an agreement with the registered shareholder who holds the shares on their behalf to be appointed (or to have someone else appointed) as a proxy for the General Meeting. Alternatively, if nominated persons do not have such a right, or do not wish to exercise it, they may have a right under such an agreement to give instructions to the person holding the shares as to the exercise of voting rights at the General Meeting.

 

The main point of contact for nominated persons remains the registered shareholder (for example your stockbroker, investment manager, custodian or other person who manages the investment on your behalf). Any changes or queries relating to nominated persons’ personal details and holdings (including any administration thereof) must continue to be directed to the registered shareholder and not the Registrars. The only exception is where HSBC, in exercising one of its powers under the UK Companies Act 2006, writes to nominated persons directly for a response.

 

 

In order for a proxy appointment made by means of CREST to be valid, the appropriate CREST message (a “CREST Proxy Instruction”) must be properly authenticated in accordance with Euroclear UK & Ireland Limited’s specifications and must contain the information required for such instructions, as described in the CREST manual. The message must be transmitted so as to be received by the issuer’s agent (ID 3RA50) by the latest time for receipt of proxy appointments specified in Note (3) above. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Applications Host) from which the issuer’s agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST.

 

CREST members and, where applicable, their CREST sponsor or voting service providers should note that Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular messages. Normal system timings and limitations will therefore apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member or sponsored member or has

 

Pursuant to Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001 the Company may treat as invalid a CREST Proxy Instruction if the Company has actual notice that:

 

 

 

*Non-executive Director

†Independent non-executive Director

 

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

HSBC Holdings plc

By: /s/ P A Stafford

Name: P A Stafford

Title: Assistant Group Secretary

Date: March 3, 2009