HSBC Mexico places debt as Wall Street crisis rages
MEXICO CITY, Oct 2 (Reuters) - The Mexican unit of HSBC bank said on Thursday it issued $168 million worth of peso- denominated bonds, despite a financial catastrophe on Wall Street that has increased risk aversion around the world.
HSBC Mexico said it placed the subordinated obligations at a yield of 28-day TIIE MXTIIE1M=RR plus 0.60 percent.
TIIE, currently at 8.68 percent, is a benchmark commercial lending rate in Mexico.
The U.S. economy is in the midst of its worst crisis since the Great Depression as banks saddled with dubious subprime mortgage loans struggle to stay afloat.
"This subordinated debt placement underscores the institution's strength and investors' confidence in HSBC, despite the current situation in international financial markets," HSBC Holdings Plc (HSBA.L) said in a statement.
In Mexico, banks owned by HSBC and other big international players, such as Citigroup Inc (C.N) and BBVA (BBVA.MC), have largely avoided turmoil from the credit crisis since their focus has been on traditional lending, not dabbling in risky subprime niches or unpredictable derivatives.
But in recent months, banks have become more careful about handing out new credit cards and consumer loans, sectors increasingly affected by nonperforming loans. ($1 = 11.179 pesos) (Reporting by Noel Randewich; Editing by Andre Grenon)
