The regulator said that the bank was also reprimanded because it failed to disclose its investment banking relationships with companies covered in some of its research reports between 2013 and 2021.
“The SFC is of the opinion that HSBC is guilty of misconduct,” the regulator said in a statement.
The SFC added that before it decided to take disciplinary action, it took into consideration that HSBC clients did not incur any losses, as well as the bank’s efforts to enhance its systems and cooperation with the Hong Kong Monetary Authority and the SFC.
HSBC failed to “act with due skill and care and implement adequate and effective systems and controls to ensure compliance with the requirement and the accuracy of disclosures in its research reports,” the statement said.
It was not the first time that HSBC, the city’s largest lender, was fined by the SFC for failing to comply with local regulations.
In 2021, HSBC incurred a US$52 million fine, a record at the time, over sales of structured products that imploded after the 2008 collapse of American investment bank Lehman Brothers.
