The class action was filed by investors in the Thema International Fund, an Irish UCITS fund the assets of which were invested with Bernard L Madoff Securities.

As the bank has previously admitted, HSBC companies provided custodial and administrative services to a variety of funds which had assets invested with Madoff Securities. As a result, as Madoff-related lawsuits have proliferated around the globe, HSBC companies have been named as defendants in suits in the US, Ireland and Luxembourg, among other jurisdictions.

HSBC says the asset value of the funds it serviced was approximately $8.4 billion, although that figure includes fictitious profits reported by Madoff’s firm. The bank estimates that transfers to Madoff Securities minus withdrawals during the time it serviced the funds totalled approximately $4.3 billion.

Thema was a limited liability company incorporated and authorised in Ireland as a UCITS fund, and HSBC Securities Services (Ireland) Limited and HSBC Institutional Trust Services (Ireland) provided custodial, administrative and other services to the fund. The bank estimates that the asset value of Thema as at 30 November 2008 was $1.1 billion, and that Thema's transfers to Madoff Securities minus its withdrawals were approximately $312 million.

Several court cases are pending against HSBC regarding Thema, including a class action pending in the US District Court for the Southern District of New York against HSBC Securities Services (Ireland), HSBC Institutional Trust Services (Ireland), HSBC Holdings and, potentially, HSBC Bank USA NA.

The bank has now entered into an agreement to settle the class action, subject to various conditions, to the tune of $62.5 million.

HSBC says the settlement, which only applies to Thema investors, is in no way to be "construed or deemed to be evidence of or an admission or concession with respect to any claim of any fault or liability or wrongdoing or damage whatsoever", adding that it believes it has good defences against the Madoff-related claims that have been brought against it and will continue to defend other Madoff- related proceedings vigorously.

This latest development in the Madoff saga comes after claims in the press in April that senior JP Morgan staff had suspicions that Madoff was running a fraud, and that the Swiss private bank Pictet sold funds to clients that lost money through Madoff’s fraud despite the investments not being recommended by the bank. Then, in May, Irving Picard filed a lawsuit against the New York commercial banking unit of a Brazilian private bank, seeking nearly $111.7 million on behalf of some of Madoff’s victims.