HSI declines 4% on financial gloom

HONG KONG: Hong Kong shares fell nearly 4 percent yesterday to their lowest in more than three months as depressing results posted by global lender HSBC and its Hong Kong subsidiary, Hang Seng Bank, deepened the gloom on an already beleaguered financial sector.

Trading in HSBC Holdings Plc remained suspended as the Hong Kong index heavyweight and Europe's largest bank announced an 18 percent fall in 2008 pre-tax profit and a $17.7 billion rights issue during the afternoon session.

Concerns over a drain on US government reserves from bailing out ailing global financial institutions including American International Group Inc added pressure on sentiment, analysts said.