HSBC Holdings and Standard Chartered Bank were yesterday given the opportunity, alongside all the other British banks, to repay their capital to shareholders under easier terms than previously available. Shares in HSBC immediately rose eight pence (about 97 Hong Kong cents) to 828 pence on the news. But Standard Chartered saw its shares fall two pence because a bearish note from Hoare Govett advised a hold on the stock after good news on proposed staff cuts had made the shares outperform the market by 10 per cent over the past month. In the Bank of England's annual report under the Banking Act, it said it had noted the strong capital margins maintained by British banks and decided to relax its policy governing the repayment of Tier 1 capital. 'As a supervisor, the bank takes comfort from strong capitalisation of banks but recognises that it may be economically inefficient for banks to maintain capital well in excess of their needs.' Both HSBC and Standard Chartered keep Tier 1 and total capital ratios well in excess of the international norms of four per cent and eight per cent respectively. HSBC's Tier 1 capital ratio is at 9.1 per cent, and total capital ratio at 14.4 per cent. Standard Chartered has Tier 1 of 7.5 per cent and total at 14.2 per cent. Before allowing banks to repay capital, the Bank of England said it would need to be convinced that the institution's capital was in excess of its needs for the foreseeable future. 'This requirement would be more onerous where a bank is seeking to repay Tier 1 capital rather than Tier 2 capital,' the bank said. 'The bank's willingness to consider repayments of Tier 1 is, nonetheless, a relaxation of its previous policy where no net repayment of permanent shareholder's equity was envisaged.' Analysts said that it was unlikely that banks would choose the option of repaying capital, rather looking towards acquisitions, as a means of profits growth. A Standard Chartered bank spokesman said: 'I don't think the Bank of England's policy will make that much difference. 'We have got used to using Tier 1 as a measure of the strength and health of the bank. 'I think we will take note of what the Bank of England says and suggests . . . but Tier 1 has continued to be a good measure of the bank and I do not think that it will change too much.'