HSBC shares dropped to their lowest in nearly 10½ years, dragging down the Hang Seng index as Hong Kong investors had their first chance to react to the bank’s discounted share sale plan and dividend cut that pummelled the stock in London overnight.

Shares in the bank tumbled 18.8 per cent to close at HK$46.25 after being suspended from trading prior to the announcement on Monday in Hong Kong. The total share issue represents about 41.7 per cent of the existing issued ordinary share capital, according to the statement.