HSBC clients in Hong Kong profit from Swiss franc error, newspapers say

HONG KONG (BLOOMBERG) - HSBC Holdings is investigating reports that customers in Hong Kong bought the Swiss franc below market rates when an online banking system failed to keep up with the currency's gains after the removal of a cap.

Apple Daily and the Hong Kong Economic Journal cited unidentified bank customers as saying that they took advantage of the mistake on Thursday evening. HSBC spokesman Maggie Cheung said in an e-mail that the lender was looking into the reports.

The Economic Journal said a person reported making an unspecified profit during a two-hour window. Apple Daily cited a person as having made HK$4,000 (S$685) after buying HK$50,000 of the Swiss currency.

In online forums, people debated whether HSBC would be able to claim back any profits.

The Swiss National Bank's decision to abandon the franc's cap against the euro roiled global markets on Thursday, with the currency surging as much as 41 per cent against the euro, the biggest gain on record.

One person cited by Apple Daily reported buying the Swiss currency at HK8.266 per franc when the market rate was in the area of HK$8.80 to HK$9. Another was said to have made a 21 per cent return on currency transactions.