Two HSBC Euro Liquidity Funds Rated 'AAA' by S&P.Business Editors PARIS--(BUSINESS WIRE)--Standard & Poor's May 11, 2001--Standard & Poor's today assigned its triple-'Am' money market fund rating to the HSBC HSBC Hongkong and Shanghai Banking Corporation HSBC Humane Society of Broward County (Florida) HSBC Humane Society of Bay County (Bay County, Michigan) Euro Liquidity Fund, a subfund of Dublin-registered HSBC Global Liquidity Funds PLC. At the same time, Standard & Poor's assigned its triple-'Af' bond fund credit rating and 'S1' volatility rating to the HSBC Euro Liquidity Plus Fund, a subfund of HSBC Global Reserve Funds PLC. The HSBC Euro Liquidity Fund was launched today and the HSBC Euro Liquidity Plus Fund will be launched by the end of the month. The 'AAAm' rating on the HSBC Euro Liquidity Fund is based on Standard & Poor's analysis of the fund's credit quality, investment policies, and market price exposure, as well as on its conservative management. The rating signifies that the safety level of the invested principal is excellent, and reflects the fund's superior capacity to maintain a stable net asset value at all times. This is achieved through conservative investment practices and strict internal controls. Standard & Poor's reviews on a weekly basis pertinent fund information, including net assets Net assets The difference between total assets on the one hand and current liabilities and noncapitalized long-term liabilities on the other hand. net assets See owners' equity. , weighted-average maturities weighted-average maturity A valuation of mortgage loans pooled into a mortgage pass-through security and calculated by multiplying the amount of the mortgage that is outstanding by the weighting of the remaining number of months to maturity for each mortgage , net asset values, and redemptions. The main investment objective of the HSBC Euro Liquidity Fund is to provide liquidity and high current income while preserving the capital. The fund strives to achieve this objective by investing in an array of high-quality, short-term instruments, such as government bonds, repurchase agreements Repurchase agreement An agreement with a commitment by the seller (dealer) to buy a security back from the purchaser (customer) at a specified price at a designated future date. , commercial paper, obligations of high-quality banks and credit institutions, and corporate obligations. The portfolio's credit quality is extremely strong, consisting of instruments with a Standard & Poor's short-term rating of at least 'A-1'. To enhance portfolio liquidity, the weighted-average maturity of the portfolios will be managed so as not to exceed 60 days, enabling the manager to accommodate shareholder redemptions while reducing sensitivity to interest rate risk. The triple-'Af' rating on the HSBC Euro Liquidity Plus Fund -- the highest rating on Standard & Poor's bond fund rating scale -- reflects the fact that the fund's portfolio investments provide the highest level of protection against losses from credit defaults, while the 'S1' volatility rating recognizes that the fund will demonstrate low sensitivity to changing market conditions. The fund aims to achieve a total return greater than the one-month London interbank bid rate London Interbank Bid Rate (LIBID) The bid rate that a Euromarket bank is willing to pay to attract a deposit from another Euromarket bank in London. Related: LIBOR. . The portfolio will take controlled interest rate risk with strictly limited currency risk, and will also limit credit risk by investing in highly rated instruments. These will include commercial paper; corporate notes, both fixed and floating; and asset-backed securities Asset-backed security A security that is collateralized by loans, leases, receivables, or installment contracts on personal property, not real estate. asset-backed security A debt security collateralized by specific assets. . The ratings also reflect the two funds' custodial arrangements with Allied Irish Banks Allied Irish Banks, p.l.c. (AIB) (Irish: Bainc-Aontas Éireann),ISEQ: ALBK, LSE: ALBK, NYSE: AIB, FWB: AIB is a commercial bank based in Ireland not to be mistaken for Anglo Irish Bank. AIB is one of the so called Big Four commercial banks in Ireland. PLC (A+/Negative/A-1), and administration arrangements with AIB/BNY Fund Management (Ireland) Ltd. The two funds' investment manager, HSBC Asset Management (Europe) S.A., is a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of HSBC Holdings PLC (A+/Stable/A-1). The funds are managed by an experienced team of investment professionals based in Paris, who take an analytical approach, focusing on credit quality and interest rate and currency risk, Standard & Poor's said. --CreditWire Copyright 2001, Standard & Poor's Ratings Services Ratings Service A company, such as Moody's or Standard & Poor's, that rates various debt and preferred stock issues for safety of payment of principal, interest, or dividends. |
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