HSBC 'becomes biggest bank'

HSBC is now the largest bank in the world, it has been revealed.

The London-listed firm has taken over the position from the Industrial and Commercial Bank of China (ICBC), in terms of market capitalisation.

Shares in ICBC have been dropping since the Asian nation's government announced a reduction to the cost of bank loans on Monday.

This is the first such cut imposed by the Chinese authorities since 2002, and led to the bank stock declining by ten per cent yesterday - its legal one-day limit.

HSBC, which fell 0.7 per cent in London on the same day, remains in relatively good health - despite suffering from credit crunch-related asset writedowns and losses, in common with other Western banks.

It now has a market value of roughly $180 billion, Reuters reports.

Thanks to its recent decline, ICBC can only manage a capitalisation of $168 billion.