Top of main content

UK Ring-fencing

What it means for HSBC and for you

Table of contents

Why have we changed our structure?

After the global economic crisis, the UK Government put new rules in place to protect the economy and taxpayers in case something similar happens again.

This means we must:

  • Separate our retail banking operations from any wholesale and investment divisions
  • Change the way we are structured in the UK - creating a new ring-fenced bank, HSBC UK Bank plc (HSBC UK)
  • Make the changes prior to 1 January 2019 - all required activities are now complete

What does this mean for you?

To ensure we meet the new banking rules, we transferred our personal customers and most of our business customers in the UK from HSBC Bank plc to HSBC UK on 1 July 2018. 

For the vast majority of our customers there has been very little change including no changes to our terms and conditions, other than changing the legal entity name for HSBC UK customers.

All changes required for the transfer of customers to HSBC UK have now taken place.

  • In 2017, HSBC UK customers received a new International Bank Account Number (IBAN) as HSBC UK has its own Bank Identifier Code (BIC). These are the details you must provide to anyone who sends you money from abroad
  • Details of your BIC/IBAN can be found on the top right hand side of your bank statement you receive in the post. Alternatively, please call us using the numbers in the Contact us section of this page

For general information please see our Frequently Asked Questions.

If your money is eligible to be protected under the Financial Services Compensation Scheme (or other similar schemes) it will still be covered as it is today.

Who will be in the ring-fenced group?

Customers in the HSBC UK Group

  • HSBC personal and commercial customers in the UK, including UK Business Banking customers categorised as Non-Bank Financial Institutions
  • Our other UK retail brands M&S Bank and first direct
  • UK Private Bank clients

Marks and Spencer Financial Services plc (MSFS) and HSBC Private Bank (UK) Limited (PBGB) will be subsidiaries of HSBC UK. They will also be ring-fenced banks. 

Customers remaining in HSBC Bank plc

  • All our Global Banking & Markets customers within our wholesale and investment banking divisions
  • Relevant Financial Institutions, including UK Corporate Banking customers categorised as Non-Bank Financial Institutions

Customers of non-UK branches of HSBC Bank plc, including:

  • All our Global Banking & Markets and Commercial customers
  • Channel Islands and Isle of Man customers
  • Expat and Private Bank Channel Islands customers

 

For general ring-fencing queries

Retail Banking and Wealth Management Customers

0345 587 3515 (from outside the UK +44 345 587 3515)

For queries relating to sort code changes:

0345 266 1359 (from outside the UK +44 345 266 1359)

Lines are open 8am to 10pm excluding public holidays.

 

Commercial Banking Customers 

0345 266 1027 (from outside the UK +44 147 0697 133)

Lines are open 8am to 6pm Monday to Friday, excluding public holidays.

 

Global Banking and Markets Customers

Please visit our portal for more information.

 

Channel Islands and Isle of Man Customers

Personal banking customers

0345 600 6161 (from outside the UK +44 1470 697 139)   

Commercial banking customers

03457 606 060 (from outside the UK +44 1226 260 878)    

Lines are open from 8am to 10pm Monday to Friday, excluding bank holidays.

 

Private Banking 

Please call your Relationship Manager. 

Key documents

A copy of the order made by the High Court following HSBC’s Directions Hearing.

A copy of the order made by the High Court following HSBC’s Case Management Conference.

A copy of the order made by the High Court following HSBC’s Sanction Hearing

 

Thank you for your help and understanding

We've kept the changes to a minimum, however, some changes we've had to make may cause some inconvenience. We are sorry for this and we'll do everything we can to make it easier.

By making these small but necessary changes we can make sure we meet the new banking rules and more importantly we'll continue to:

  • help our customers with all their day to day financial needs
  • ensure our customers benefit from the knowledge, experience and financial strength that HSBC has gained through more than 150 years in banking

 

Frequently Asked Questions

General ring-fencing questions

Are all UK banks impacted by the new rules?
The Banking Reform Act (ring-fencing) impacts most large banks in the UK. Specifically those with deposits of £25bn or more. If you have accounts with more than one bank in the UK, this may mean you receive similar communications from them too.


When will my account changes happen?
We’re pleased to say that all changes, such as providing HSBC UK customers with a new Branch Identifier Code (BIC) and International Bank Account Number (IBAN) and changes to sort codes have already taken place.

 

Will this change affect my credit history or transaction history?
No, there will be no change to either of these.


What if I am a personal or commercial customer with an account in the Channel Islands and Isle of Man (CIIOM)?
CIIOM customers will continue to receive the same service that they currently receive from our CIIOM branches. We will continue to focus our services specifically on your needs based on the Islands and you will still have full access to the knowledge and support from HSBC Internationally.


I've received some other letters about changes to my accounts as a result of ring-fencing rules. How do I know this is not fraud?
Vigilance is key. Other banks may also be undertaking similar changes.

However, if something does not look right or you have any concerns regarding your HSBC accounts, please contact us using the numbers listed on the contact us section of this page.


I am concerned that all these changes increase the risk of fraud on my account, what is being done to protect me?
At HSBC, protecting our customers from fraud is a key priority for us. We deploy market leading fraud detection systems which routinely monitor for fraudulent activity. We also try to minimise the amount we contact customers as they go about their everyday spending and banking activities. 

We'd like to remind customers to "take five and stop to think". If you receive a phone call, text or email asking you to hand over personal or financial information, you need to take a moment to reflect and step back from the situation. Additional information can be found on the Take Five website.

More information can be found by visiting: Personal Customers Fraud Guide and Business Banking Fraud Guide.


If you are redirecting my payments, why do I need to do anything?
HSBC and other banks are using redirection capabilities to ensure that all payments reach the right account even where account details are changing. Unfortunately, we cannot rely on redirection forever so account details used by the payer will need to be updated.

The banking industry is working to ensure that payment details are updated behind the scenes to keep any inconvenience to a minimum and this will mean most payment details will be updated on UK payments (i.e. those where you do not need to provide your BIC and IBAN). We ask that you provide your new sort code and account details to anyone you receive payments from as updating the details yourself is the most secure way to ensure that all payments are received without delay.

If you are expecting to receive a high value or international payment (where you need to provide your BIC and IBAN), you will need to take action and inform your payer of your new details so that future payments can be received directly in to your account. If international payments are made using your old BIC and IBAN details they should still reach your account, although funds may take longer to reach your account.

 

What will the future credit rating of HSBC UK be?

Fitch Ratings Inc. and Standard & Poor’s (S&P) affirmed a credit rating for our new UK ring-fenced bank, HSBC UK at AA-

 

What will the future credit rating of HSBC Bank plc be? 

  • Fitch and Standard & Poor’s (S&P) have each affirmed a credit rating for HSBC Bank plc of AA- that takes ring-fencing into account
  • On 27 September 2017, Moody’s applied a one notch downgrade to HSBC Bank plc, and gave it a rating of Aa3 (their equivalent of AA-), but this reflected their view of wider economic conditions
  • On 31 May 2018, Moody’s confirmed that HSBC Bank plc rating as unchanged at Aa3

 

BIC/IBAN change

What is a BIC / IBAN?
BIC stands for Bank Identifier Code and IBAN for International Bank Account Number. These are your sort code and account number written in a standard, internationally recognised format. They help us to process international payments automatically, making them faster and safer.


Why is the BIC / IBAN changing?

We’ve changed the way HSBC is structured in the UK. It means our personal and commercial customers have moved to a new bank, HSBC UK. Therefore, we needed to be able to identify this new bank with the new BIC/IBAN. 

 

What happens if I am sent payments using my old account details?
If you are expecting any payments into your account using your 'old' BIC / IBAN, we will do all we can to ensure the funds reach your account as normal. However, please do ensure that you provide your new account details to anyone who sends your funds from abroad.


What do I need to do?
You will need to:

  • give your new BIC and IBAN details to anyone who sends you high value or international payments
  • if you receive payments through the SEPA Credit Transfer scheme, please be aware this scheme doesn't allow payment redirection. This means you'll need to tell anyone paying you via this scheme to use your new details or the payment will be rejected before it reaches us.

For commercial customers, you will also need to:

  • give your new details to anyone who needs them within your own business
  • update any internal systems and stationery (including invoice and payment templates) to make sure future payments are sent with the new account details
  • make sure profile owners and administrators of HSBCnet, HSBC Connect, SWIFT or other 3rd party internet banking systems are made aware of these changes
  • business Internet Banking users in Hong Kong will need to update their payment templates with the new BIC and IBAN details when sending payments to the UK
  • please consider if you need to tell anyone else about these changes to your account details. You might need to if, for example, you've given security to anyone, such as a charge over your account or the money in it.


What are you doing to help me?
We'll:

  • provide you with your new account details so that you can advise anyone who sends you money of the changes
  • redirect any payments coming into your account (but remember this may take longer for international payments)

For commercial customers:

  • If you're also a customer of HSBC Invoice Finance (UK) Limited (HIF), we'll amend the payment account details held under your Bank Payment Authority to HIF.


What is the difference between a SWIFT BIC and a Branch BIC?
BIC stands for 'Bank Identifier Code'.

There are two forms of BIC:

  • BIC8 which identifies the bank (sometimes called 'SWIFT BIC')
  • BIC11 which identifies the bank branch

You will need to provide either your SWIFT BIC, or your Branch BIC, as well as your IBAN to receive funds from abroad.


What is my SWIFT BIC (BIC8)?
The SWIFT BIC (BIC8) is HBUKGB4B.


What do we mean by a 'high value payment'?
For HSBC, high value refers to CHAPS and TARGET2. In our online banking systems and templates these are sometimes referred to as an Electronic Funds Transfer, or a Priority Payment.

 

Qualification declaration

What are the qualifying criteria?
For corporates and partnerships (not in their first year of trading) the following criteria is used to determine which clients will remain part of HSBC Bank plc. This is a one off exercise for existing customers and is based on the latest financial accounts:

  • Turnover: equal to or greater than £6.5m
  • Balance sheet total: equal to or greater than £3.26m
  • Number of employees: equal to or greater than 50


Which customers are impacted?
All customers that are not Relevant Financial Institutions (RFIs), in the UK and European Economic Area (EEA) branches of HSBC Bank plc that are not transferring to HSBC UK.


Which customers are out of scope and why?
Ring-fencing legislation says that RFI's and customers in the Crown Dependencies cannot be part of the ring-fenced bank and therefore must bank with HSBC Bank plc. These customers therefore do not need to go through this qualification exercise.

This does not apply to corporates or partnerships who are customers of subsidiaries of HSBC Bank plc.

 

Security held for the benefit of both HSBC UK and HSBC Bank plc

What is Security?
Security refers to items pledged by the customer as a secondary source of repayment for borrowing facilities provided by the bank.
 

What is changing with security?
After the legal separation (expected to occur 01 July 2018, subject to court approval) of the current HSBC Bank plc into the ring-fenced bank (HSBC UK) and non-ring-fenced bank (HSBC Bank plc), if you hold products requiring security with both banks, that security will be held on trust by HSBC UK on behalf of both banks. This means you won’t need to change any of your current UK security arrangements, regardless of which bank provides the products. If you’re unsure which bank will provide your products after the legal separation, please ask your Relationship Manager.
 

All of my products will transfer to HSBC UK; will my security arrangements change?
Yes, all of your security arrangements will transfer to HSBC UK after the legal separation (expected to occur 01 July 2018, subject to court approval). We’ll do this for you, so you don’t need to take any action with regard to your security arrangements in the UK.
 

All of my products will remain with HSBC Bank plc; will my security arrangements change?
No, if all of your products remain with HSBC Bank plc then your security will too, and you don’t need to take any action with regard to these arrangements.
 

I hold products requiring security with both HSBC UK and HSBC Bank plc; will my security change?
Your security will be held on trust by HSBC UK, on behalf of both banks. Your current arrangements will continue to secure your liabilities for each product requiring security, regardless of whether the products remain with HSBC Bank plc or move to HSBC UK, without the need to provide security to each bank separately.
 

Which types of security will be included?
All security given by UK entities and individuals that is governed by the law of UK countries and granted in respect of a specific debt or given on an “all monies” basis will be included. We call these “UK security arrangements” in our Terms and Conditions.
 

Will I need re-sign anything related to security?
You don’t need to take any action related to your UK security arrangements. They will be transferred automatically where required, after the legal separation (expected to occur 01 July 2018, subject to court approval) and will be part of either HSBC UK or HSBC Bank plc or both. The only change will be that your security will be held on trust by HSBC UK on behalf of both banks if you hold products which require security with both banks. 

If security has been registered (for example at the Land Registry), we will amend the register as necessary on your behalf. Pending completion of the reregistration at the relevant Land Registry, that security will be held on trust by HSBC Bank plc for HSBC UK Bank plc.
 

What if I have overseas security?
For security and loan arrangements outside of the UK, we may need to contact you separately to ensure that these arrangements transfer. If you have these types of arrangements they, and your related UK arrangements, will stay in HSBC Bank plc until we have agreed and completed a transfer for these with you. HSBC Bank plc will continue to hold them until the transfer occurs.

We're here to help you. Find the answers and while you're at it, tell us how we could do better.