REG - HSBC Holdings PLC - HSBC Holdings 2025 Results
25/02/2026 07:00
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RNS Number : 3236U HSBC Holdings PLC 25 February 2026
25 February 2026
HSBC Holdings plc 2025 results
Georges Elhedery, Group CEO, said:
"2025 was a year of decisive action and swift execution, which is reflected in
our strong performance. Each of our four businesses performed well and we have
strong momentum across the bank. That is why we are raising our ambition and
targeting a 17% RoTE or better, excluding notable items, in each year from
2026 to 2028. We are also targeting year-on-year revenue growth over the same
period on the same basis, rising to 5% in 2028. We are becoming a simple, more
agile, focused bank, one that moves with the speed our customers need to
navigate the modern world. We are delivering growth, investing for growth and
we are executing our strategy with discipline and precision. That gives us
confidence in our ability to continue delivering for our shareholders."
2025 financial performance (vs 2024)
- Reported profit before tax decreased by $2.4bn to $29.9bn,
mainly due to a $4.9bn year-on-year net adverse impact from notable items.
Profit after tax decreased by $1.9bn to $23.1bn.
- In 2025, notable items included dilution and impairment
losses of $2.1bn related to our associate Bank of Communications Co., Limited
('BoCom'), reserve recycling losses of $1.5bn following the completion of the
sale of our French retained portfolio of home and certain other loans, legal
provisions of $1.4bn and restructuring and other related costs associated with
our organisational simplification of $1.0bn. In 2024, notable items included
net losses relating to our disposals in Canada and Argentina of $1.4bn.
- Constant currency profit before tax excluding notable items
increased by $2.4bn to $36.6bn, from a strong performance in Wealth in our
International Wealth and Premier Banking ('IWPB') and Hong Kong businesses,
and from Wholesale Transaction Banking in our Corporate and Institutional
Banking ('CIB') business. This was partly offset by a rise in expected credit
losses and other credit impairment charges ('ECL') and an increase in
operating expenses due to planned investment and inflation.
- RoTE in 2025 was 13.3%, compared with 14.6% in 2024.
Excluding notable items, RoTE in 2025 was 17.2%, a rise of 1.6 percentage
points compared with 2024.
- Revenue of $68.3bn increased by $2.4bn or 4% compared with
2024. The increase was primarily due to fee and other income growth in Wealth
from Investment Distribution and Insurance, and in Wholesale Transaction
Banking, particularly in Foreign Exchange in CIB. This was partly offset by
the year-on-year impact of notable items, mainly relating to business
disposals and a dilution loss related to BoCom.
Constant currency revenue excluding notable items rose by $3.4bn to $71.0bn.
- Net interest income ('NII') of $34.8bn was $2.1bn higher
than 2024 reflecting the benefit of the reinvestment of our structural hedge
at higher yields, deposit balance growth and higher NII in Markets Treasury.
In addition, the increase included the non-recurrence of a $0.2bn loss in 2024
on the early redemption of legacy securities. This was partly offset by the
adverse year-on-year impact of $1.6bn from business disposals in Argentina and
Canada, and margin compression on our deposits. The growth in NII of $2.1bn
also reflected a benefit from lower funding costs associated with the trading
book of $1.7bn. Banking net interest income ('banking NII'), which excludes
these funding costs, increased by $0.3bn to $44.1bn.
- Net interest margin ('NIM') of 1.59% was 3 basis points
('bps') higher, reflecting the reinvestment of our structural hedge at higher
yields.
- ECL were $3.9bn, an increase of $0.4bn compared with 2024,
including charges in both periods related to the commercial real estate
('CRE') sectors in Hong Kong and mainland China. In 2025, the charge in this
sector in Hong Kong of $0.7bn (2024: $0.1bn) reflected higher allowances for
new defaulted exposures, the impact of an over-supply of non-residential
properties that has put continued downward pressure on rental and capital
values, and updates to our models used for ECL calculations. The 2025 charge
in the mainland China CRE sector was $0.2bn (2024: $0.4bn). ECL were 39 bps of
average gross loans, including loans and advances classified as held for sale.
- Operating expenses increased by $3.4bn or 10% to $36.4bn.
The increase primarily reflected notable items in 2025 of $3.0bn, including
legal provisions of $1.4bn, restructuring and other related costs associated
with our organisational simplification of $1.0bn, and $0.5bn related to
disposals, wind-downs, acquisitions and related costs.
- Cost growth also reflected planned spend and investment in
technology, higher performance-related pay and the impacts of inflation,
partly offset by reductions related to our business disposals and the benefits
of our organisational simplification.
- Target basis operating expenses rose by 3%, in line with our
cost growth target. This increase primarily reflected higher planned spend and
investment in technology, higher performance-related pay and the impact of
inflation, partly offset by the benefits of our organisational simplification.
- Customer lending balances rose by $57.7bn including
favourable foreign currency translation differences. On a constant currency
basis, lending balances rose by $17.6bn, mainly in our UK business reflecting
growth in mortgage and commercial customer lending.
- Customer accounts rose by $131.9bn, including favourable
foreign currency translation differences. On a constant currency basis,
customer accounts increased by $67.6bn with growth in all our businesses,
particularly our Hong Kong business segment.
- Common equity tier 1 ('CET1') capital ratio remained at
14.9%. This reflected an increase in risk-weighted assets ('RWAs'), which was
offset by an increase in CET1 capital through capital generation net of
distributions. The increase in RWAs was mainly driven by foreign currency
translation differences and asset size movements.
- The Board has approved a fourth interim dividend of $0.45
per share, resulting in a total of $0.75 per share in respect of 2025.
4Q25 financial performance (vs 4Q24)
- Reported profit before tax up $4.5bn to $6.8bn. The increase
included a $3.3bn year-on-year net favourable impact from notable items,
primarily due to the non-recurrence of the recycling of foreign currency
losses and other reserves of $5.2bn recognised following the completion of
sale of our business in Argentina in 4Q24, partly offset by reserve recycling
losses of $1.5bn following the completion of the sale of our French retained
portfolio of home and certain other loans in 4Q25. The increase also included
growth in banking NII and lower ECL. Reported profit after tax up $4.6bn to
$5.2bn.
- Revenue of $16.4bn increased by $4.8bn or 42%, including a
$3.6bn year-on-year impact from notable items from the disposals mentioned
above. The increase in revenue also reflected growth in banking NII, as well
as higher fee and other income from Wealth. Constant currency revenue
excluding notable items increased by $1.0bn to $17.7bn.
- ECL down $0.5bn to $0.9bn, primarily reflecting lower ECL on
wholesale exposures, in particular as 4Q24 included stage 3 charges relating
to the CRE sector in mainland China of $0.2bn and a charge in CIB relating to
a single UK corporate exposure.
- Operating expenses increased by $0.7bn or 8% to $9.3bn. The
increase reflected notable items, including an increase in restructuring and
other related costs associated with our organisation simplification of $0.2bn.
The increase also reflected higher planned spend and investment in technology,
higher performance-related pay and the impact of inflation, partly offset by
the benefits of our organisational simplification.
Outlook
Group financial targets
- We are targeting a RoTE of 17% or better for 2026, 2027 and
2028, excluding notable items. Our revised target reflects momentum in our
earnings and the positive progress we are making in our strategic execution.
- We are targeting year-on-year growth in revenue from 2026 to
2028, rising to 5% growth in 2028 compared with 2027 excluding notable items
and on a constant currency basis.
- We maintain our dividend payout ratio target basis of 50% in
2026, 2027 and 2028. Our target basis payout ratio is calculated as a
percentage of earnings per share ('EPS') excluding material notable items and
related impacts.
In respect of 2026:
- We expect banking NII of at least $45bn, based on our
current expectations for policy rates.
- We expect ECL charges as a percentage of average gross loans
to be around 40bps in 2026 (including held for sale loan balances). Over the
medium term, we retain our planning range of 30-40bps.
- We retain our commitment to Group-wide cost discipline. We
are targeting growth in target basis operating expenses of approximately 1%
compared with 2025.
- Our target basis operating expenses measure excludes notable
items and includes the impact of simplification-related saves associated with
our announced reorganisation.
- We intend to continue to manage the CET1 capital ratio
within our medium-term target range of 14%-14.5%. Capital may fall below our
target range during January 2026 owing to the privatisation of Hang Seng Bank,
which had a net CET1 capital impact of 110bps in January 2026 (based on our
CET1 capital ratio as at 31 December 2025). This included a day one impact of
around 120bps on CET1, partly offset by a release of around 10bps of
incremental hedging-related structural foreign exchange RWAs.
- We expect to restore our CET1 capital ratio within our
target range through a combination of organic capital generation and not
initiating any further buy-backs until CET1 capital is back within, or above,
this range. A decision to recommence buy-backs will be subject to our normal
buy-back considerations and process on a quarterly basis.
Ñ Our targets and expectations reflect our current outlook for the global
macroeconomic environment and market-dependent factors, such as market-implied
interest rates (as of end January 2026) and rates of foreign exchange, as well
as customer behaviour and activity levels.
Ñ We do not reconcile our forward guidance on RoTE excluding notable items,
constant currency revenue excluding notable items, target basis operating
expenses, dividend payout ratio target basis or banking NII to their
equivalent reported measures.
Ñ See pages 93 to 94 of the Annual Report and Accounts 2025 for a further
explanation of RoTE excluding notable items, constant currency revenue
excluding notable items, banking NII, target basis operating expenses and
dividend payout ratio target basis. For further information on our CET1 ratio,
see page 158 of the Annual Report and Accounts 2025.
Key financial metrics
For the year ended
Reported results 2025 2024 2023
Profit before tax ($m) 29,907 32,309 30,348
Profit after tax ($m) 23,131 24,999 24,559
Net operating income before change in expected credit losses and other credit 68,274 65,854 66,058
impairment charges ('revenue') ($m)
Cost efficiency ratio (%) 53.4 50.2 48.5
Net interest margin (%) 1.59 1.56 1.66
Basic earnings per share ($) 1.21 1.25 1.15
Diluted earnings per share ($) 1.20 1.24 1.14
Dividend per ordinary share (in respect of the period) ($)(1) 0.75 0.87 0.61
Dividend payout ratio (%)(2) 50 50 50
Alternative performance measures
Constant currency profit before tax ($m) 29,907 32,384 29,802
Constant currency revenue ($m) 68,274 66,009 65,040
Constant currency banking net interest income ($m) 44,084 43,550 42,515
Constant currency cost efficiency ratio (%) 53.4 50.2 48.7
Constant currency profit before tax excluding notable items ($m) 36,617 34,181 32,841
Constant currency revenue excluding notable items ($m) 71,020 67,591 64,835
Constant currency profit before tax excluding notable items and strategic 36,617 33,768 N/A
transactions ($m)
Constant currency revenue excluding notable items and strategic transactions 71,020 66,377 N/A
($m)
Expected credit losses and other credit impairment charges (annualised) as a % 0.39 0.34 0.31
of
average gross loans and advances to customers, including held for sale (%)
Basic earnings per share excluding material notable items and related impacts 1.51 1.31 1.22
($)
Return on average ordinary shareholders' equity (annualised) (%) 12.3 13.6 13.6
Return on average tangible equity (annualised) (%) 13.3 14.6 14.6
Return on average tangible equity excluding notable items (annualised) (%) 17.2 15.6 16.0
Target basis operating expenses ($m) 33,464 32,478 N/A
At 31 Dec
Balance sheet 2025 2024 2023
Total assets ($m) 3,233,034 3,017,048 3,038,677
Net loans and advances to customers ($m) 988,399 930,658 938,535
Constant currency net loans and advances to customers ($m) 988,399 970,778 955,706
Customer accounts ($m) 1,786,828 1,654,955 1,611,647
Constant currency customer accounts ($m) 1,786,828 1,719,240 1,641,000
Average interest-earning assets, year to date ($m) 2,190,078 2,099,285 2,161,746
Loans and advances to customers as % of customer accounts (%) 55.3 56.2 58.2
Total shareholders' equity ($m) 198,225 184,973 185,329
Tangible ordinary shareholders' equity ($m) 165,153 154,295 155,710
Net asset value per ordinary share at period end ($) 10.36 9.26 8.82
Tangible net asset value per ordinary share at period end ($) 9.64 8.61 8.19
Capital, leverage and liquidity
Common equity tier 1 capital ratio (%)(3,4) 14.9 14.9 14.8
Risk-weighted assets ($m)(3,4) 888,647 838,254 854,114
Total capital ratio (%)(3,4) 20.5 20.6 20.0
Leverage ratio (%)(3,4) 5.3 5.6 5.6
High-quality liquid assets (liquidity value) ($m)(4,5) 702,123 649,210 647,505
Liquidity coverage ratio (%)(4,5) 137 138 136
Net stable funding ratio (%)(4,5) 143 143 138
Share count
Period end basic number of $0.50 ordinary shares outstanding, after deducting 17,140 17,918 19,006
own shares held (millions)
Period end basic number of $0.50 ordinary shares outstanding and dilutive 17,276 18,062 19,135
potential ordinary shares, after deducting own shares held (millions)
Average basic number of $0.50 ordinary shares outstanding, after deducting own 17,427 18,357 19,478
shares held (millions)
Ñ For reconciliation and analysis of our reported results on a constant
currency basis, including lists of notable items, see page 76 of the Annual
Report and Accounts 2025. Definitions and calculations of other alternative
performance measures are included in 'Reconciliation of alternative
performance measures' on page 92 of the Annual Report and Accounts 2025.
1 In 2024, dividend per share includes the special dividend of $0.21 per
ordinary share arising from the proceeds of the sale of our banking business
in Canada to Royal Bank of Canada.
2 Our dividend payout ratio is adjusted for material notable items and related
impacts, including all associated income statement impacts relating to those
items.
3 Regulatory capital ratios and requirements are based on the transitional
arrangements of the Capital Requirements Regulation in force at the time.
Effective 1 January 2025, the IFRS 9 transitional arrangements came to an
end, followed by the end of the CRR II grandfathering provisions on 28 June
2025.
4 Regulatory numbers and ratios are as presented at the date of reporting.
Small changes may exist between these numbers and ratios and those submitted
in regulatory filings. Where differences are significant, we may restate in
subsequent periods.
5 The liquidity coverage ratio is based on the average value of the preceding
12 months. The net stable funding ratio is based on the average value of four
preceding quarters.
Group Chairman's shareholder letter
It is with great pride that I have begun my tenure as Group Chairman of HSBC.
I am truly privileged to serve such a remarkable institution, working
alongside exceptionally talented colleagues.
Our 161-year history is firmly rooted in the objective set by HSBC's founders
- to establish a bank in Hong Kong and Shanghai that would facilitate local
and international trade.
By not losing sight of that foundational objective and by remaining true to
our purpose and values, we have focused on what matters most - our customers -
moving forward together through these most complex of times.
Building on that forward momentum, the Board and I will continue to closely
partner with our highly capable CEO, Georges Elhedery, and his management team
who are accelerating the execution of our strategy, with discipline and
confidence.
A Modern HSBC: Simple and More Agile
A key catalyst for achieving that acceleration was the introduction in January
2025 of our new organisational structure centred on our four businesses: Hong
Kong, the UK, Corporate and Institutional Banking, and International Wealth
and Premier Banking.
By halving the number of operating businesses and significantly streamlining
the new Operating Committee of the Group, we embarked on a journey to become a
simple and more agile organisation; a modern institution that reflects its
cherished legacy, while embracing technological advances as a core enabler of
future growth, competitiveness, and, ultimately, customer aspirations.
Today, HSBC is clear on its core strengths, investing to further develop our
competitive advantages and deliver sustainable growth, with an entirely
attainable ambition to be the most trusted bank globally, putting customers at
the heart of everything we do.
Global Context
Global growth in 2025 was stronger than expected, as the tariff-related
headwinds were offset by the significant momentum generated by AI capital
expenditure and trade growth, and by the support provided by the
ever-resilient US consumer.
The global geopolitical context was marked by continued uncertainty. The war
in Ukraine, which has entered its fifth year, and conflicts in the Middle East
and elsewhere, continue to have significant human consequences.
In parallel, the changing approach to global trade relations has increased
economic uncertainty. But as the resilience of global trade growth
demonstrates, the inter-connectedness of the global economy, underpinned by
growing trade flows, is compelling.
Faced with the re-configuration of the globalised world, HSBC is optimally
positioned to help our customers capture the meaningful opportunities that are
driving the global economy forward, across geographies and throughout our
unique global network. Our strong financial performance and material returns
in 2025 point to that dynamic, along with our focused approach to implementing
our strategic priorities.
2025 Performance
In 2025, we delivered reported profit before tax of $29.9bn. Our return on
average tangible equity was 13.3%, or 17.2% excluding the impact of notable
items.
We delivered material returns for our shareholders. The Board approved a
fourth quarterly dividend of $0.45 per share, bringing the total dividend
announced for 2025 to $0.75 per share. In addition, we announced two share
buy-backs in respect of 2025 worth a total of $6bn.
Dividends paid in 2025, together with a more than 49% increase in the share
price, delivered a total shareholder return for the year of more than 57%.
With our realigned structure providing a decisive impetus, we achieved
broad-based profit generation through geographic and business diversification.
Our performance reflects that, as does our ability to invest for growth, while
continuing to optimise cost and capital allocation. Indeed, we are keeping to
our committed objective of delivering $1.5bn of organisational simplification
savings and expect to have taken the relevant actions to achieve it by the end
of June 2026, which is six months earlier than planned.
Against this backdrop, we believe that the privatisation of Hang Seng Bank is
a milestone development that brings together two seminal institutions that
have served Hong Kong - a home market for the Group - for generations. We are
absolutely committed to building on that valued legacy. While respecting Hang
Seng's heritage and retaining its brand and distinct customer proposition, we
will continue to invest and build on the complementary strengths of our
businesses, to the benefit of our valued customers and the communities that we
serve.
Sustainability
Our ambition remains to become a net zero bank by 2050. Supporting our
customers is core to our strategy - financing their transition is both
critical to them and aligned to our net zero ambition.
In November 2025, we published our updated Net Zero Transition Plan, setting
out our commercially-grounded sustainability strategy, which reflects the
realities of an evolving global transition. We also set out our updated
interim financed emissions targets, metrics and associated policies, seeking
to remain science-aligned and compatible with our own net zero ambition.
We believe that supporting our customers' transition is one of the most
significant roles we can play in the global transition to net zero. We aim to
provide and facilitate between $750bn and $1tn of sustainable finance and
investment by 2030. In 2025, we provided and facilitated $102bn in sustainable
finance and investment, bringing our cumulative total to $495.6bn since
January 2020. This puts us on track to meet our target by 2030.
Leadership and Board Changes
As I begin my first full year as Group Chairman, I want to acknowledge and pay
tribute to Sir Mark Tucker's remarkable leadership and exemplary commitment to
the Group.
Over a period of eight years, Mark helped steer HSBC through a number of
unprecedented challenges - a global pandemic, decades-high inflation and
profound shifts in the trade and geopolitical landscape - leaving the Group
more profitable, resilient, and strongly positioned for accelerated growth. I
am very grateful to him for the trusted partnership, friendship, and his
support in ensuring a smooth handover.
We also announced the appointment of Wei Sun Christianson as an independent
non-executive Director, with effect from 1 January 2026. Wei brings extensive
banking and regulatory experience gained over a 30-year international career,
including as Co-CEO of Asia Pacific at Morgan Stanley.
Ann Godbehere will be stepping down as a Director of the Company and retire
from the Board at our 2026 AGM. I want to thank Ann for her considerable
contributions to the HSBC Board.
In October, we announced the appointment of Angela McEntee as Group Company
Secretary with effect from 1 January 2026.
In 2025, the Board held meetings in Hong Kong, India, and London. These were
invaluable opportunities to meet with valued clients, government
representatives, regulators and colleagues.
We also had productive engagements with our shareholders on important
Group-related issues at our Annual General Meeting in London and at the
Informal Meeting of our Hong Kong Shareholders.
Year Ahead
We expect the global economy to expand in 2026. Despite significant policy
uncertainty, global trade is also set to grow, supported by the expansion of
new trade corridors and the boom in AI hardware demand. Inflation should
continue drifting downward, although with divergence across markets. Somewhat
uneven growth across industries and geographies could contribute to periodic
financial volatility.
In China, a stronger policy push should anchor its growth, and we expect it to
broadly maintain its expansion pace of recent years, as structural reforms
start to gain traction. As part of its continued economic transformation, the
emphasis will be on strengthening domestic demand - particularly consumption,
but also investment. Services consumption will benefit from government policy
priorities, as will technology development. Hong Kong will continue to benefit
as the super-connector between mainland China and the rest of the world.
Buoyant markets and improvements in consumption are expected to support its
growth this year.
Elsewhere in Asia, robust consumption and rising exports generated impressive
growth in a number of markets, in ASEAN in particular. That combination is
expected to continue in 2026. In India, domestic demand will likely be the
main driver of growth, reflecting robust consumption, as well as ongoing
government infrastructure investment.
Economic diversification continues in the Middle East, with deep capital
reserves being deployed into significant investments in infrastructure,
technology, and human capital. The Asia-Middle East trade, investment, and
travel corridor continues to grow.
Europe's economy will be supported by fiscal expansion, particularly in
Germany, coupled with lower effective interest rates and steady consumption
growth. We see euro area growth maintaining its recent pace over the next
year. In the UK, greater fiscal headroom should give markets and businesses
more confidence. Lower expected inflation and interest rates should provide a
tailwind for consumption growth.
The US should be a key driver of global growth, reaping the benefits of
sizeable investments in AI, tax cuts and incentives, as well as substantial
deregulation.
Our Colleagues
I will end where I began, by recognising and wholeheartedly thanking our HSBC
colleagues. They are the ones who deliver for our customers, day in and day
out, with excellence, dedication, and respect.
They are the backbone of the Group, embodying our high-performance culture.
Their commitment to our customers and to maintaining and further strengthening
the relationships we have built with them is what set us apart in 2025 and
what will help us thrive going forward, to the benefit of our shareholders.
Brendan Nelson
Group Chairman
25 February 2026
Group CEO's shareholder letter
Dear fellow shareholders,
In previous letters I set out a clear agenda to unlock HSBC's full potential.
2025 marked a year of decisive action and swift execution. We are performing,
transforming and investing for growth as demand for globally-connected
financial services increases, especially in the world's fastest-growing
regions.
We have aligned our structure with our strategy and strengthened our four
complementary businesses. We are becoming a simple, more agile, focused bank
built for a fast-changing world. One that stays true to our strong foundations
and hallmark financial strength yet moves with the speed our customers need to
navigate the modern world.
The dynamic market environment shows why our global network, deep local
expertise built over generations and financial strength set us apart. It also
shows why our customers continue to turn to us as their reliable and trusted
financial partner.
New targets: 2026-2028
Last February, we set out a three-year target of a mid-teens return on average
tangible equity ('RoTE') in each of the three years from 2025 to 2027,
excluding notable items. We made clear progress against this target in 2025.
That is why we are now raising our ambition and targeting 17% RoTE or better
in each year from 2026 to 2028, excluding notable items. We are also targeting
year-on-year revenue growth over the same period rising to 5% in 2028 compared
with 2027, excluding notable items. We maintain our dividend payout ratio
target basis of 50% in 2026, 2027 and 2028. Our target basis payout ratio is
calculated as a percentage of EPS, excluding material notable items and
related impacts.
Strong performance
On a reported basis, profit before tax of $29.9bn fell 7% year-on-year due to
the impact of notable items. These included dilution and impairment losses of
$2.1bn related to BoCom, legal provisions of $1.4bn and $1.0bn of
restructuring and other related costs associated with our organisational
simplification. On this basis, we delivered a RoTE of 13.3%.
Excluding notable items, our RoTE was 17.2% achieving our 'mid-teens, or
better' target. Our revenue increased 5% year-on-year to $71bn and our profit
before tax grew 7% to $36.6bn, excluding notable items on a constant currency
basis. Our common equity tier 1 ('CET1') capital ratio was 14.9%, reflecting
our long-standing financial strength.
We maintained tight cost discipline, managing target basis cost growth to
around 3%, thereby achieving our target. This strong performance enabled us to
announce a total ordinary dividend per share for 2025 of $0.75, or $12.9bn, an
increase of 14% on the prior year. In addition, we completed $6bn of share
buy-backs taking total returns to $18.9bn.
Momentum
Our four businesses are built on customer trust and performed well. Revenue
and deposits grew in each and all four delivered RoTE of mid-teens, or better,
excluding notable items. We saw growth accelerate in areas of core strength
and we are actively investing in modern technology to enhance innovation,
productivity and customer experience.
Turning to business-line performance on a year-on-year and constant currency
basis, our market-leading Hong Kong business generated revenue of $15.9bn, or
6% growth. Our deposit base grew by 7% to more than $540bn, helping us
maintain our number one position in Hong Kong with market share of 25%. Our UK
business delivered revenue of $12.9bn, an increase of 5%, supported by robust
balance sheet growth with customer loans increasing by 6% to more than $300bn.
CIB increased revenue by 3% to $27.6bn, and we generated $13.1bn of fee and
other income, which was 7% higher than the prior year.
In 2025, we facilitated around $900bn in trade, which is comparable to the
economic output of a G20 economy. This represents the equivalent of around
$2.5bn of goods and services moving through our global network every single
day. This scale, which gives access to 86% of world trade flows, is why we
were voted in a survey of 13,000 corporates as Euromoney's 'World's Best Trade
Finance Bank' for the ninth consecutive year. Across our network we processed
around $500tn of payment transactions in 130 currencies, equivalent to almost
$1bn every minute. That is why 30,000 customers surveyed by Euromoney voted
HSBC the number one payments bank in products, services and technology.
In IWPB, revenue was $14.5bn, an increase of 5%. Wealth fee and other income
across all our businesses was $9.4bn, up 24%. At 31 December 2025, bank-wide
Wealth balances were $2.1tn, of which more than $1tn was booked in Asia,
reflecting our position as the leading wealth manager in Asia and the Middle
East. Given the importance of managing customer deposits as well as their
invested assets, we are changing our wealth disclosures. In 2026, we will
replace Invested assets (2025: $1.5tn) with a new calculation of Wealth
balances. The new disclosure adds our wealth customers' deposits of $608bn and
removes $580bn of Asset Management third-party distribution assets. On this
new basis, Wealth balances in 2025 were $1.6tn.
In 2025, we were pleased to update our Net Zero Transition Plan, which
reaffirms our ambition to become a net zero bank by 2050 and emphasises the
importance of supporting our customers in their transitions.
Discipline
We expect to have taken action to deliver our $1.5bn organisational
simplification saves by the first half of 2026, six months ahead of plan. The
initiative is designed to make HSBC simple and more agile with an immaterial
revenue impact. Cost efficiency is one of the key benefits, clearer
accountability and greater collaboration are others. The saves will be taken
straight to the bottom line.
We have reviewed our portfolio against our strategic priorities and are moving
at pace to exit non-strategic or low-returning activities. This initiative is
expected to release $1.5bn of incremental investment capacity, which we are
actively reallocating to areas of competitive strength where we can generate
accretive returns. In 2025, we announced 11 exits, of which three have fully
completed. These are in addition to the two transactions we announced in 2024.
Taken together, the completed and announced exits will generate $0.7bn in
annualised cost savings and exits in active execution, including activities
under strategic review, are expected to generate a further $0.6bn.
Following the privatisation of Hang Seng Bank, reported cost synergies across
HSBC and Hang Seng Bank will release $0.3bn, which we will direct towards
growth opportunities in Hong Kong. To reflect this, we are increasing our
medium-term cost reallocation commitment from $1.5bn to $1.8bn.
Investing for growth
Our $13.7bn privatisation of Hang Seng Bank brings together 255 years of
history and heritage, combining global reach and local depth. It allows us to
scale capabilities across both banks for all customers. Hong Kong is a dynamic
economy, a top three global financial centre and a thriving trade gateway. It
is a super-connector between mainland China and the world. It is also poised
to become the world's leading cross-border wealth hub by 2029. The
privatisation of Hang Seng Bank reflects our confidence and conviction in Hong
Kong's future growth.
In our home markets, we are expanding the number of Wealth Centres and
enhancing our wealth capabilities. In Hong Kong we opened five new
state-of-the-art Wealth Centres. They provide a space where our Private
Banking and Premier customers can meet our wealth specialists to plan, invest
and manage their long-term financial future. In the UK, our flagship Wealth
Centre launched in Mayfair, London, and we opened a second in Leeds, a major
regional wealth hub.
Also in the UK, investment in our Business Banking coverage model is
generating results. We are growing customer numbers, lowering attrition rates
and seeing greater advocacy.
In IWPB we opened a further 20 new Wealth Centres focusing on Asia and the
Middle East, excluding those in markets under strategic review. These are in
many of the world's fastest-growing wealth economies, such as mainland China,
Singapore and the UAE. We became the world's first global asset manager to
establish an onshore platform in the UAE, offering retail and institutional
investors access to 10 new funds. We refreshed our Premier proposition for
affluent customers in four markets and it is now live in seven.
In CIB, we are using digital innovation to serve customers faster. Our
tokenised deposits now offer next-generation real time payments across our
network. They are available in Hong Kong, Singapore, the UK and Luxembourg.
Other markets will follow in 2026. With mobile-first consumers changing
customer payment choices, we are changing digital wallet collection
capabilities. Our Digital Merchant Services solution allows omnichannel
payments, making e-commerce easier and more efficient for retailers. It is
currently available in Hong Kong, India and Singapore, with six more markets
launching in 2026.
We are also reengineering HSBC while focusing on resilience and risk
management. We are modernising the bank through AI and automation to enhance
customer experience, increase productivity and boost efficiency. We have more
than 100 GenAI active use cases and are increasing AI partnerships to
accelerate adoption of cutting-edge technologies. More than 31,000 of our
engineers now use an AI-enabled coding assistant and our HSBC Productivity
Suite tool is available to around 85% of our colleagues to help summarise,
analyse and translate documents.
High performance culture
A clear strategy sets our direction. A strong culture is what turns it into
results. This is why we are investing to build a high-performance culture.
First, we refreshed our ambition: 'To be the most trusted bank globally,
putting customers at the heart of everything we do'.
Second, we launched six new Leadership Principles and How We Lead, our new
Group-wide leadership framework. All our senior leaders, and the broader
Managing Director cohort, have now attended a two-day How We Lead event and
86% surveyed believe it is creating a positive cultural change. In 2026, we
will roll it out to our broader people leaders globally. In the spirit of our
Leadership Principle that 'great leaders build better leaders', more than 150
of our senior leaders will facilitate a How We Lead event in 2026.
Our people
I would like to thank Sir Mark Tucker for his exceptional leadership over the
last eight years and congratulate Brendan Nelson on his appointment as Group
Chairman. I look forward to continue working with Brendan as we pursue our
clear agenda to unlock HSBC's full potential.
I would also like to take this opportunity to thank all my colleagues for
their many valuable contributions to our results. It is a privilege to work
with such talented people. Their dedication, commitment and passion to deliver
for our customers truly differentiates HSBC and is key to delivering
sustainable long-term growth for you, our shareholders.
Georges Elhedery
Group CEO
25 February 2026
Distribution of results by business segments(1)
Constant currency profit/(loss) before tax
Year ended 31 Dec
2025 2024
$m % $m %
Hong Kong 9,576 32.0 9,129 28.2
UK 6,705 22.4 6,823 21.1
Corporate and Institutional Banking 11,386 38.1 11,283 34.8
International Wealth and Premier Banking 4,367 14.6 3,969 12.3
Corporate Centre (2,127 ) (7.1 ) 1,180 3.6
Profit before tax 29,907 100.0 32,384 100.0
1 Effective from 1 January 2025, the Group's operating segments comprise four
new businesses: Hong Kong, UK, Corporate and Institutional Banking ('CIB') and
International Wealth and Premier Banking ('IWPB'), along with Corporate
Centre. All segmental comparative data has been re-presented on this basis.
Distribution of results by legal entity
Reported profit/(loss) before tax
Year ended 31 Dec
2025 2024
$m % $m %
HSBC UK Bank plc 7,409 24.8 7,213 22.2
HSBC Bank plc (224 ) (0.7 ) 2,645 8.2
The Hongkong and Shanghai Banking Corporation Limited 19,588 65.5 20,470 63.4
HSBC Bank Middle East Limited 1,090 3.6 1,114 3.4
HSBC North America Holdings Inc. 1,198 4.0 832 2.6
HSBC Bank Canada - - 186 0.6
Grupo Financiero HSBC, S.A. de C.V. 649 2.2 730 2.3
Other trading entities(1) 1,798 6.0 1,829 5.7
Holding companies, shared service centres and intra-group eliminations (1,601 ) (5.4 ) (2,710 ) (8.4)
Profit before tax 29,907 100.0 32,309 100.0
1 Other trading entities includes the results of entities located in Türkiye,
Egypt and Saudi Arabia (including our share of the results of Saudi Awwal
Bank) which do not consolidate into HSBC Bank Middle East Limited.
HSBC constant currency profit before tax and balance sheet data
2025
Hong Kong UK CIB IWPB Corporate Centre Total
$m $m $m $m $m $m
Net operating income/(expense) before change in expected credit losses and 15,878 12,938 27,637 14,520 (2,699 ) 68,274
other impairment charges(1)
- external 10,157 13,856 39,098 12,458 (7,295 ) 68,274
- inter-segment 5,721 (918 ) (11,461 ) 2,062 4,596 -
of which: net interest income/(expense)(2) 12,082 11,096 14,532 7,397 (10,313 ) 34,794
Change in expected credit losses and other credit impairment charges (1,476 ) (696 ) (696 ) (892 ) (90 ) (3,850 )
Net operating income/(expense) 14,402 12,242 26,941 13,628 (2,789 ) 64,424
Total operating expenses (4,826 ) (5,537 ) (15,556 ) (9,285 ) (1,224 ) (36,428 )
Operating profit/(loss) 9,576 6,705 11,385 4,343 (4,013 ) 27,996
Share of profit in associates and joint ventures less impairment(3) - - 1 24 1,886 1,911
Constant currency profit before tax 9,576 6,705 11,386 4,367 (2,127 ) 29,907
% % % % % %
Share of HSBC's constant currency profit before tax 32.0 22.4 38.1 14.6 (7.1 ) 100.0
Constant currency cost efficiency ratio 30.4 42.8 56.3 63.9 (45.4 ) 53.4
Constant currency balance sheet data $m $m $m $m $m $m
Loans and advances to customers (net) 229,491 303,698 305,022 150,047 141 988,399
Interests in associates and joint ventures - - 83 522 28,972 29,577
Total external assets 437,933 451,492 1,793,162 416,332 134,115 3,233,034
Customer accounts 543,381 364,323 597,719 281,058 347 1,786,828
Constant currency risk-weighted assets(4) 139,628 152,973 408,687 89,876 97,483 888,647
2024
Net operating income/(expense) before change in expected credit losses and 15,047 12,342 26,772 13,817 (1,969 ) 66,009
other credit impairment charges
- external 9,704 13,060 39,012 11,175 (6,942 ) 66,009
- inter-segment 5,343 (718 ) (12,240 ) 2,642 4,973 -
of which: net interest income/(expense)(2) 11,997 10,355 14,519 8,081 (12,497 ) 32,455
Change in expected credit losses and other credit impairment charges (1,077 ) (415 ) (878 ) (993 ) (29 ) (3,392 )
Net operating income/(expense) 13,970 11,927 25,894 12,824 (1,998 ) 62,617
Total operating expenses (4,841 ) (5,104 ) (14,612 ) (8,900 ) 311 (33,146 )
Operating profit/(loss) 9,129 6,823 11,282 3,924 (1,687 ) 29,471
Share of profit/(loss) in associates and joint ventures - - 1 45 2,867 2,913
Constant currency profit/(loss) before tax 9,129 6,823 11,283 3,969 1,180 32,384
% % % % % %
Share of HSBC's constant currency profit before tax 28.2 21.1 34.8 12.3 3.6 100.0
Constant currency cost efficiency ratio 32.2 41.4 54.6 64.4 15.8 50.2
Constant currency balance sheet data $m $m $m $m $m $m
Loans and advances to customers (net) 235,053 285,778 297,877 144,027 8,043 970,778
Interests in associates and joint ventures - - 132 557 29,039 29,728
Total external assets 433,588 432,683 1,729,531 414,734 129,265 3,139,801
Customer accounts 506,557 352,833 587,926 271,588 336 1,719,240
Constant currency risk-weighted assets(4) 143,777 142,763 400,687 89,739 88,518 865,484
1 Includes a loss of $1.1bn inclusive of reserves recycling as a result of the
dilution of our shareholding in BoCom. See Note 18 on pages 319 to 322 of the
Annual Report and Accounts 2025.
2 Includes $9.7bn (2024: $11.4bn) of interest expense in Corporate Centre for
the internal cost to fund our Markets Treasury function.
3 Includes an impairment loss of $1.0bn recognised in respect of the Group's
investment in BoCom. See Note 18 on pages 319 to 322 of the Annual Report and
Accounts 2025.
4 Constant currency risk-weighted assets are calculated using reported
risk-weighted assets adjusted for the effects of currency translation
differences.
Consolidated income statement
for the year ended 31 December 2025
2025 2024
$m $m
Net interest income 34,794 32,733
- interest income(1,2) 97,872 108,631
- interest expense(3) (63,078 ) (75,898 )
Net fee income 13,343 12,301
- fee income 17,608 16,266
- fee expense (4,265 ) (3,965 )
Net income from financial instruments held for trading or managed on a fair 19,682 21,116
value basis(4)
Net income/(expense) from assets and liabilities of insurance businesses, 11,175 5,901
including related derivatives, measured at fair value through profit or loss
Insurance finance expense (11,197 ) (5,978 )
Insurance service result 1,825 1,310
- insurance service revenue 3,228 2,752
- insurance service expense (1,403 ) (1,442 )
Losses recognised on sale of business operations(5) (47 ) (1,752 )
Other operating income/(expense)(6,7) (1,301 ) 223
Net operating income before change in expected credit losses and other credit 68,274 65,854
impairment charges(8)
Change in expected credit losses and other credit impairment charges (3,850 ) (3,414 )
Net operating income 64,424 62,440
Employee compensation and benefits (19,553 ) (18,465 )
General and administrative expenses (11,959 ) (10,498 )
Depreciation and impairment of property, plant and equipment and right-of-use (1,971 ) (1,845 )
assets(9)
Amortisation and impairment of intangible assets (2,945 ) (2,235 )
Total operating expenses (36,428 ) (33,043 )
Operating profit 27,996 29,397
Share of profit in associates and joint ventures 2,911 2,912
Impairment of interest in associate(7) (1,000 ) -
Profit before tax 29,907 32,309
Tax expense (6,776 ) (7,310 )
Profit for the year 23,131 24,999
Attributable to:
- ordinary shareholders of the parent company 21,102 22,917
- other equity holders 1,183 1,062
- non-controlling interests 846 1,020
Profit for the year 23,131 24,999
$ $
Basic earnings per ordinary share 1.21 1.25
Diluted earnings per ordinary share 1.20 1.24
1 Includes $83.3bn (2024: $93.4bn) of interest recognised on financial assets
measured at amortised cost and $14.5bn (2024: $15.3bn) of interest recognised
on financial assets measured at fair value through other comprehensive income.
In 2024, it also includes a net $0.2bn loss related to the early redemption of
legacy securities.
2 Interest income is calculated using the effective interest method and
comprises interest recognised on financial assets measured at either amortised
cost or fair value through other comprehensive income.
3 Interest expense includes $60.1bn (2024: $72.6bn) of interest on financial
instruments, excluding interest on debt instruments issued by HSBC for funding
purposes that are designated under the fair value option to reduce an
accounting mismatch and on derivatives managed in conjunction with those debt
instruments included in interest expense.
4 In 2025, the amounts include a $0.1bn (2024: $0.1bn gain) mark-to-market
gain on interest rate hedging of the portfolio of retained loans post sale of
our retail banking operations in France and a $0.1bn fair value loss on Grupo
Financiero Galicia's ('Galicia') American Depositary Receipts ('ADRs')
received as purchase consideration from the sale of our business in Argentina.
In 2024, the amounts include a $0.3bn gain on the foreign exchange hedging of
the proceeds from the sale of our banking business in Canada.
5 In 2024, the amount includes a $1.0bn loss on disposal and a $5.2bn loss on
the recycling in foreign currency translation reserve losses and other
reserves arising on sale of our business in Argentina. This was partly offset
by a gain of $4.6bn, inclusive of the recycling of $0.6bn in foreign currency
translation reserve losses and $0.4bn of other reserves losses but excluding
the $0.3bn gain on the foreign exchange hedging (see footnote 4 above) on the
sale of our banking business in Canada.
6 Includes a loss on net monetary positions of $0.2bn (2024: $1.2bn) as a
result of applying IAS 29 'Financial Reporting in Hyperinflationary
Economies'.
7 In 2025, the amounts include recycling of cumulative fair value losses of
$1.5bn relating to the French retained portfolio of home and certain other
loans following the completion of its sale to a consortium comprising Rothesay
Life plc and CCF and a loss of $1.1bn inclusive of reserves recycling as a
result of the dilution of our shareholding in BoCom. We have also recognised a
$1.0bn impairment loss following an impairment test on the carrying value of
the Group's investment in BoCom in 'Impairment of interest in associate'. See
Note 18 on pages 319 to 322 of the Annual Report and Accounts 2025.
8 Also referred to as revenue.
9 Includes depreciation of the right-of-use assets of $0.7bn (2024: $0.7bn).
Consolidated statement of comprehensive income
for the year ended 31 December 2025
2025 2024
$m $m
Profit for the year 23,131 24,999
Other comprehensive income/(expense)
Items that will be reclassified subsequently to profit or loss when specific
conditions are met:
Debt instruments at fair value through other comprehensive income 3,036 163
- fair value gains/(losses) 1,525 41
- fair value losses/(gains) transferred to the income statement on disposal 1,328 69
- expected credit (recoveries)/losses recognised in the income statement (19 ) (6 )
- disposal of subsidiary 745 85
- income taxes (543 ) (26 )
Cash flow hedges 1,773 (52 )
- fair value gains/(losses) 749 (282 )
- fair value (gains)/losses reclassified to the income statement 1,611 (135 )
- disposal of subsidiary - 262
- income taxes (587 ) 103
Share of other comprehensive income/(expense) of associates and joint ventures 54 462
- share for the year 110 462
- fair value gains transferred to the income statement on disposal - -
- other comprehensive income reclassified to the income statement on disposal (56 ) -
of interest in an associate
Net finance income/(expenses) from insurance contracts (682 ) (142 )
- net finance expenses 7 (191 )
- disposal of subsidiary (687 ) -
- income taxes (2 ) 49
Exchange differences 6,771 833
- foreign exchange losses reclassified to the income statement on disposal or 208 5,816
dilution of a foreign operation
- other exchange differences 6,563 (4,983 )
Items that will not be reclassified subsequently to profit or loss:
Fair value gains on property revaluation 14 5
- fair value gains 14 5
- income taxes - -
Remeasurement of defined benefit asset/(liability) (184 ) (228 )
- before income taxes (190 ) (342 )
- income taxes 6 114
Changes in fair value of financial liabilities designated at fair value upon (479 ) (439 )
initial recognition arising from changes in own credit risk
- before income taxes (642 ) (579 )
- income taxes 163 140
Equity instruments designated at fair value through other comprehensive income 98 99
- fair value gains/(losses) 127 141
- income taxes (29 ) (42 )
Effects of hyperinflation 140 1,239
Other comprehensive income/(expense) for the year, net of tax 10,541 1,940
Total comprehensive income/(expense) for the year 33,672 26,939
Attributable to:
- ordinary shareholders of the parent company 31,478 24,833
- other equity holders 1,183 1,062
- non-controlling interests 1,011 1,044
Total comprehensive income/(expense) for the year 33,672 26,939
Consolidated balance sheet
at 31 December 2025
At
31 Dec 2025 31 Dec 2024
$m $m
Assets
Cash and balances at central banks 242,859 267,674
Hong Kong Government certificates of indebtedness 44,063 42,293
Trading assets 366,153 314,842
Financial assets designated and otherwise mandatorily measured at fair value 133,063 115,769
through profit or loss
Derivatives 237,740 268,637
Loans and advances to banks 108,462 102,039
Loans and advances to customers 988,399 930,658
Reverse repurchase agreements - non-trading 298,392 252,549
Financial investments 567,211 493,166
Assets held for sale 11,115 27,234
Prepayments, accrued income and other assets 184,794 152,740
Current tax assets 864 1,313
Interests in associates and joint ventures 29,577 28,909
Goodwill and intangible assets 13,107 12,384
Deferred tax assets 7,235 6,841
Total assets 3,233,034 3,017,048
Liabilities
Hong Kong currency notes in circulation 44,063 42,293
Deposits by banks 97,952 73,997
Customer accounts 1,786,828 1,654,955
Repurchase agreements - non-trading 204,974 180,880
Trading liabilities 72,122 65,982
Financial liabilities designated at fair value 158,456 138,727
Derivatives 237,854 264,448
Debt securities in issue 99,675 105,785
Liabilities of disposal groups held for sale 23,382 29,011
Accruals, deferred income and other liabilities 142,123 130,340
Current tax liabilities 3,037 1,729
Insurance contract liabilities 122,955 107,629
Provisions 3,441 1,724
Deferred tax liabilities 2,100 1,317
Subordinated liabilities 28,406 25,958
Total liabilities 3,027,368 2,824,775
Equity
Called up share capital 8,588 8,973
Share premium account 111 14,810
Other equity instruments 20,716 19,070
Other reserves (795 ) (10,282 )
Retained earnings 169,605 152,402
Total shareholders' equity 198,225 184,973
Non-controlling interests 7,441 7,300
Total equity 205,666 192,273
Total liabilities and equity 3,233,034 3,017,048
Consolidated statement of changes in equity
for the year ended 31 December 2025
Other reserves
Called up Other Financial Cash Foreign Merger Insurance Retained earnings Total Non- Total
equity assets at flow exchange
share- controlling equity
share capital
and other finance
instru-ments FVOCI hedging reserve
holders' interests
and share reserve reserve reserves reserve(1) equity
premium
$m $m $m $m $m $m $m $m $m $m $m
At 1 Jan 2025 23,783 19,070 (3,246 ) (1,079 ) (32,887 ) 26,328 602 152,402 184,973 7,300 192,273
Profit for the year - - - - - - - 22,285 22,285 846 23,131
Other comprehensive income (net of tax) - - 2,926 1,649 6,863 14 (602 ) (474 ) 10,376 165 10,541
- debt instruments at fair value through other comprehensive income(2) - - 2,267 - - - - - 2,267 24 2,291
- equity instruments designated at fair value through other comprehensive - - 84 - - - - - 84 14 98
income
- cash flow hedges - - - 1,700 - - - - 1,700 73 1,773
- changes in fair value of financial liabilities designated at fair value upon - - - - - - - (479 ) (479 ) - (479 )
initial recognition arising from changes in own credit risk
- property revaluation - - - - - 14 - - 14 - 14
- remeasurement of defined benefit asset/liability - - - - - - - (189 ) (189 ) 5 (184 )
- share of other comprehensive income of associates and joint ventures - - - - - - - 110 110 - 110
- effects of hyperinflation - - - - - - - 140 140 - 140
- foreign exchange reclassified to income statement on disposal or dilution of - - - - 208 - - - 208 - 208
a foreign operation(3)
- other reserves reclassified to income statement on disposal or dilution of a - - 745 - - - (687 ) (56 ) 2 - 2
foreign operation(4)
- insurance finance income/(expense) recognised in other comprehensive income - - - - - - 5 - 5 - 5
- exchange differences - - (170 ) (51 ) 6,655 - 80 - 6,514 49 6,563
Total comprehensive income for the year - - 2,926 1,649 6,863 14 (602 ) 21,811 32,661 1,011 33,672
Shares issued under employee remuneration and share plans 116 - - - - - - (116 ) - - -
Share premium reclassification to retained earnings(5) (14,810 ) - - - - - - 14,810 - - -
Capital redemption reserves reclassification to retained earnings(5) - - - - - (1,755 ) - 1,755 - - -
Capital securities issued(6) - 4,096 - - - - - - 4,096 - 4,096
Dividends to shareholders - - - - - - - (12,764 ) (12,764 ) (718 ) (13,482 )
Redemption of securities(7) - (2,450 ) - - - - - - (2,450 ) - (2,450 )
Cost of share-based payment arrangements - - - - - - - 621 621 - 621
Transfers - - - - - - - - - - -
Share buy-back(9) - - - - - - - (8,039 ) (8,039 ) - (8,039 )
Cancellation of shares (390 ) - - - - 390 - - - - -
Other movements(10) - - 1 - - 1 - (875 ) (873 ) (152 ) (1,025 )
At 31 Dec 2025 8,699 20,716 (319 ) 570 (26,024 ) 24,978 - 169,605 198,225 7,441 205,666
Consolidated statement of changes in equity (continued)
for the year ended 31 December 2024
Other reserves
Called up share capital Other Financial assets at FVOCI reserve Cash flow Foreign Merger Insurance Retained earnings Total Non- Total
equity hedging exchange
share- controlling equity
and share premium
and other reserves finance
instru-ments reserve reserve
holders' interests
reserve(1) equity
$m $m $m $m $m $m $m $m $m $m $m
At 1 Jan 2024 24,369 17,719 (3,507 ) (1,033 ) (33,753 ) 28,601 785 152,148 185,329 7,281 192,610
Profit for the year - - - - - - - 23,979 23,979 1,020 24,999
Other comprehensive income (net of tax) - - 259 (46 ) 863 5 (183 ) 1,018 1,916 24 1,940
- debt instruments at fair value through other comprehensive income - - 62 - - - - - 62 16 78
- equity instruments designated at fair value through other comprehensive - - 75 - - - - - 75 24 99
income
- cash flow hedges - - - (312 ) - - - - (312 ) (2 ) (314 )
- changes in fair value of financial liabilities designated at fair value upon - - - - - - - (439 ) (439 ) - (439 )
initial recognition arising from changes in own credit risk
- property revaluation - - - - - 5 - - 5 - 5
- remeasurement of defined benefit asset/liability - - - - - - - (244 ) (244 ) 16 (228 )
- share of other comprehensive income of associates and joint ventures - - - - - - - 462 462 - 462
- effects of hyperinflation - - - - - - - 1,239 1,239 - 1,239
- foreign exchange reclassified to income statement on disposal or dilution of - - - - 5,816 - - - 5,816 - 5,816
a foreign operation
- other reserves reclassified to income statement on disposal or dilution of a - - 85 262 - - - - 347 - 347
foreign operation
- insurance finance income/(expense) recognised in other comprehensive income - - - - - - (142 ) - (142 ) - (142 )
- exchange differences - - 37 4 (4,953 ) - (41 ) - (4,953 ) (30 ) (4,983 )
Total comprehensive income for the year - - 259 (46 ) 863 5 (183 ) 24,997 25,895 1,044 26,939
Shares issued under employee remuneration and share plans 77 - - - - - - (77 ) - - -
Share premium reclassification to retained earnings - - - - - - - - - - -
Capital redemption reserves reclassification to retained earnings - - - - - - - - - - -
Capital securities issued - 3,601 - - - - - - 3,601 - 3,601
Dividends to shareholders - - - - - - - (16,410 ) (16,410 ) (690 ) (17,100 )
Redemption of securities - (2,250 ) - - - - - - (2,250 ) - (2,250 )
Transfers(8) - - - - - (2,945 ) - 2,945 - - -
Cost of share-based payment arrangements - - - - - - - 529 529 - 529
Share buy-back - - - - - - - (11,043 ) (11,043 ) - (11,043 )
Cancellation of shares (663 ) - - - - 663 - - - - -
Other movements - - 2 - 3 4 - (687 ) (678 ) (335 ) (1,013 )
At 31 Dec 2024 23,783 19,070 (3,246 ) (1,079 ) (32,887 ) 26,328 602 152,402 184,973 7,300 192,273
1 The insurance finance reserve reflects the impact of the adoption of the
other comprehensive income option for our insurance business in France.
Underlying assets supporting these contracts are measured at fair value
through other comprehensive income. Under this option, only the amount that
matches income or expenses recognised in profit or loss on underlying items is
included in finance income or expenses, resulting in the elimination of income
statement accounting mismatches. The remaining amount of finance income or
expenses for these insurance contracts is recognised in other comprehensive
income ('OCI'). At 31 December 2025, the entire balance was reclassified to
income statement following completion of the sale of the insurance business in
France.
2 Includes recycling of fair value losses of $1.5bn following completion of
the sale of our retail banking operations in France.
3 Includes the recycling of a $0.2bn foreign currency translation reserves
loss as a result of the dilution of our shareholding in BoCom.
4 Includes insurance finance income reclassification of $0.7bn and $0.7bn fair
value losses reclassification following completion of the sale of our
insurance business in France.
5 On 24 June 2025, the High Court of Justice in England and Wales confirmed
the cancellation of $14.8bn standing to the credit of the HSBC Holdings' share
premium account and $1.8bn standing to the credit of its capital redemption
reserve, following approval at HSBC Holdings' Annual General Meeting held on
2 May 2025 (the 'Capital Reduction'). The Court Order confirming the Capital
Reduction was registered by the Registrar of Companies on 10 July 2025,
resulting in a combined total of $16.6bn being reclassified to retained
earnings with no impact on total equity.
6 HSBC Holdings issued $1.5bn 6.950% contingent convertible securities in
February 2025, SGD0.8bn 5.000% contingent convertible securities in March 2025
and $2.0bn 7.050% contingent convertible securities in June 2025. All
instruments were recorded net of issuance costs.
7 In March 2025, HSBC Holdings redeemed its $2.45bn 6.375% contingent
convertible securities.
8 At 31 December 2024, an impairment of $11.4bn of HSBC Overseas Holdings (UK)
Limited was recognised, resulting in a permitted transfer of $2.9bn from the
remaining historical associated merger reserve to retained earnings.
9 HSBC Holdings announced the following share buy-backs during the year: a
share buy-back of up to $2.0bn in February 2025, which was completed in April
2025; a share buy-back of up to $3.0bn in May 2025, which was completed in
July 2025 and a share buy-back of up to $3.0bn in July 2025, which was
completed in October 2025.
10 Includes $1.1bn (2024: $0.5bn) of shares bought by HSBC Holdings Employee
Benefit Trust to satisfy obligation to deliver shares under employee share
plans.
Consolidated statement of cash flows
for the year ended 31 December 2025
2025 2024
$m $m
Profit before tax 29,907 32,309
Adjustments for non-cash items:
Depreciation, amortisation and impairment 4,916 4,080
Net loss from investing activities 2,614 180
Share of profit in associates and joint ventures (2,911 ) (2,912 )
Impairment of interest in associate 1,000 -
(Gain)/loss on acquisition/disposal of subsidiaries, businesses, associates 93 1,704
and joint ventures
Change in expected credit losses gross of recoveries and other credit 4,170 3,674
impairment charges
Provisions including pensions 2,103 299
Share-based payment expense 621 529
Other non-cash items included in profit before tax (4,690 ) (5,290 )
Elimination of exchange differences(1) (34,682 ) 26,734
Changes in operating assets and liabilities
Change in net trading securities and derivatives (38,630 ) (41,385 )
Change in loans and advances to banks and customers (74,071 ) 7,275
Change in reverse repurchase agreements - non-trading (32,342 ) (4,227 )
Change in financial assets designated and otherwise mandatorily measured at (23,393 ) (20,662 )
fair value
Change in other assets (38,389 ) 7,685
Change in deposits by banks and customer accounts 168,907 44,237
Change in repurchase agreements - non-trading 24,094 8,700
Change in debt securities in issue (5,613 ) 11,942
Change in financial liabilities designated at fair value 46,129 (2,248 )
Change in other liabilities 4,098 (1,603 )
Dividends received from associates 1,040 1,062
Contributions paid to defined benefit plans (147 ) (167 )
Tax paid (5,058 ) (6,611 )
Net cash from operating activities 29,766 65,305
Purchase of financial investments (502,391 ) (523,454 )
Proceeds from the sale and maturity of financial investments(2) 470,309 453,502
Net cash flows from the purchase and sale of property, plant and equipment (1,447 ) (1,344 )
Net cash flows from disposal of loan portfolio and customer accounts - -
Net investment in intangible assets (3,214 ) (2,542 )
Net cash inflow on acquisition/disposal of subsidiaries, businesses, 1,126 9,891
associates and joint ventures(3)
Net cash outflow on acquisition/disposal of subsidiaries, businesses, (1,451 ) (12,617 )
associates and joint ventures(4)
Net cash from investing activities (37,068 ) (76,564 )
Issue of ordinary share capital and other equity instruments 4,096 3,602
Share buy-back (9,091 ) (11,348 )
Net purchases of own shares for market-making and investment purposes (1,123 ) (541 )
Net cash flow from change in stake of subsidiaries (154 ) -
Redemption of preference shares and other equity instruments (2,450 ) (3,433 )
Subordinated loan capital issued 3,834 4,361
Subordinated loan capital repaid(5) (3,591 ) (2,000 )
Dividends paid to shareholders of the parent company and non-controlling (13,482 ) (17,100 )
interests
Net cash from financing activities (21,961 ) (26,459 )
Net decrease in cash and cash equivalents (29,263 ) (37,718 )
Cash and cash equivalents at 1 Jan 434,940 490,933
Exchange differences in respect of cash and cash equivalents 27,210 (18,275 )
Cash and cash equivalents at 31 Dec(6) 432,887 434,940
Cash and cash equivalents comprise:
- cash and balances at central banks 242,859 267,674
- loans and advances to banks of one month or less(9) 74,404 69,803
- reverse repurchase agreements with banks of one month or less 71,790 58,290
- treasury bills, other bills and certificates of deposit less than three 41,232 27,307
months(8)
- cash collateral, net settlement accounts and items in course of collection 2,214 9,827
from/transmission to other banks
- cash and cash equivalents held for sale(7) 387 2,039
Cash and cash equivalents at 31 Dec(6) 432,887 434,940
Interest received was $99.6bn (2024: $110.1bn), interest paid was $68.8bn
(2024: $81.7bn) and dividends received (excluding dividends received from
associates, which are presented separately above) were $2.7bn (2024: $2.8bn).
1 Adjustment to bring changes between opening and closing balance sheet
amounts to average rates. This is not done on a line-by-line basis, as details
cannot be determined without unreasonable expense.
2 This includes $5.8bn from the sale of our retained portfolio of home and
certain other loans in France.
3 In 2025, this includes $1.0bn from the sale of our French life insurance
business, and in 2024 this includes $9.3bn from the sale of our banking
business in Canada.
4 In 2025, this includes $1bn from sale of our private banking business in
Germany and $0.4bn from sale of our retail banking operations in Bahrain and
in 2024, this includes $10.6bn from the sale of our retail banking operations
in France and $1.8bn from the sale of our business in Argentina
5 Subordinated liabilities changes during the year are attributable to
repayments of $(3.6)bn (2024: $(2.0)bn) of securities. Non-cash changes
during the year included foreign exchange gains/losses of $1.4bn gain (2024:
$1.6bn gain) and fair value gains/losses of $0.7bn gain (2024: $1.0bn gain).
6 At 31 December 2025, $66.6bn (2024: $50.4bn) was not available for use by
HSBC due to a range of restrictions, including currency exchange. This
includes $9.6bn (2024: Nil) segregated for Hang Seng Bank privatisation
funding purposes. Refer to Note 37 of the Annual Report and Accounts 2025 for
more details.
7 Includes $0.3bn (2024: $1.9bn) of cash and balances at central banks and
$0.04bn (2024: $0.1bn) of loans and advances to banks of one month or less.
There is nil balance in 2025 for reverse repurchase agreements with banks of
one month or less (2024: nil) and cash collateral, net settlement accounts and
items in course of collection from/transmission to other banks (2024: nil).
8 The amount in this line is included in the 'Financial investments' and
'Financial assets designated and otherwise mandatorily measured at fair value
through profit or loss' line items in the Consolidated balance sheet on page
12.
9 The amount in this line is included in the 'Loans and advances to banks',
'Financial investments' and 'Financial assets designated and otherwise
mandatorily measured at fair value through profit or loss' line items in the
Consolidated balance sheet on page 12.
1 Basis of preparation and material accounting policies
The basis of preparation and summary of material accounting policies
applicable to the consolidated financial statements of HSBC and the separate
financial statements of HSBC Holdings can be found in Note 1, or the relevant
Note, in the Financial Statements in the Annual Report and Accounts 2025.
(a) Compliance with International Financial Reporting Standards
The consolidated financial statements of HSBC and the separate financial
statements of HSBC Holdings comply with UK-adopted international accounting
standards and with the requirements of the Companies Act 2006, and have also
applied international financial reporting standards adopted pursuant to
Regulation (EC) No 1606/2002 as it applies in the European Union. These
financial statements are also prepared in accordance with International
Financial Reporting Standards as issued by the International Accounting
Standards Board ('IFRS Accounting Standards'), including interpretations
issued by the IFRS Interpretations Committee, as there are no applicable
differences from IFRS Accounting Standards for the periods presented. There
were no unendorsed standards effective for the year ended 31 December 2025
affecting these consolidated and separate financial statements.
IFRS Accounting Standards adopted during the year ended 31 December 2025
There were no new standards, amendments to standards or interpretations that
had an effect on these financial statements. Accounting policies have been
applied consistently.
(b) Differences between IFRS Accounting Standards and Hong Kong Financial
Reporting Standards
There are no significant differences between IFRS Accounting Standards and
Hong Kong Financial Reporting Standards in terms of their application to HSBC,
and consequently there would be no significant differences had the financial
statements been prepared in accordance with Hong Kong Financial Reporting
Standards. The 'Notes on the financial statements', taken together with the
'Report of the Directors' in the Annual Report and Accounts 2025 include the
aggregate of all disclosures necessary to satisfy IFRS Accounting Standards
and Hong Kong Financial Reporting Standards.
(c) Going concern
The financial statements are prepared on a going concern basis, as the
Directors are satisfied that the Group and parent company have the resources
to continue in business for the foreseeable future. In making this assessment,
the Directors have considered a wide range of information relating to present
and future conditions, including future projections of profitability, cash
flows, capital requirements and capital resources.
These considerations include stressed scenarios that reflect the uncertainty
in the macroeconomic environment, including ongoing supply chain disruptions,
uncertain inflation, rapidly changing interest rates, the impact of the
Russia-Ukraine war and further conflict or military action in the Middle East,
Venezuela or elsewhere; uncertainty around Hong Kong and mainland China's CRE
sectors; heightened strategic competition between the US and China, ongoing
and potential cross-border investment and trade restrictions, changes to
tariff rates, as well as the potential impacts from other top and emerging
risks, including climate change, as well as the related impacts on
profitability, capital and liquidity.
2 Tax
Tax expense
2025 2024
$m $m
Current tax(1) 6,978 6,115
- for this year 6,606 5,863
- adjustments in respect of prior periods(3) 324 31
- Pillar 2 and qualifying domestic top-up taxes 48 221
Deferred tax (202 ) 1,195
- origination and reversal of temporary differences 173 1,288
- effect of changes in tax rates 35 (2 )
- adjustments in respect of prior periods(3) (410 ) (91 )
Year ended 31 Dec(2) 6,776 7,310
1 Current tax included Hong Kong profits tax of $2,351m (2024: $1,615m). The
Hong Kong tax rate applying to the profits of subsidiaries assessable in Hong
Kong was 16.5% (2024: 16.5%).
2 In addition to amounts recorded in the income statement, a tax charge of
$136m (2024: credit of $12m) was recorded directly to equity.
3 Adjustments in respect of prior periods includes deferred tax credits in
Hong Kong arising on temporary differences between IFRS and the regulatory
basis of accounting on which the tax returns are prepared, and in the UK on
tax losses, both of which arise from the finalisation of 2024 tax returns and
are offset by corresponding charges in current tax.
Tax reconciliation
The tax charged to the income statement differs from the tax charge that would
apply if all profits had been taxed at the UK corporation tax rate as follows:
2025 2024
$m % $m %
Profit before tax 29,907 32,309
Tax expense
Taxation at UK corporation tax rate of 25.0% (2024: 25.0%, 2023: 23.5%) 7,477 25.0 8,077 25.0
Impact of differently taxed overseas profits in overseas locations (1,316 ) (4.4 ) (1,351 ) (4.2 )
UK banking surcharge 179 0.6 215 0.7
Items increasing tax charge in 2025:
- local taxes and overseas withholding taxes 692 2.3 584 1.8
- movements in unrecognised deferred tax 314 1.0 259 0.7
- fines and provisions for legal settlements 294 1.0 - -
- impairment of investment in BoCom 250 0.8 - -
- other permanent disallowables 237 0.8 344 1.0
- dilution loss on the Group's investment in BoCom 128 0.4 - -
- movements in provisions for uncertain tax positions 118 0.4 38 0.1
- impact of business disposals 100 0.3 - -
- non-deductible bank levy expense 75 0.3 73 0.2
- impact of global and domestic minimum taxes 48 0.2 221 0.7
- impact of changes in tax rates 35 0.1 6 -
- impact of hyperinflation 32 0.1 327 1.0
- tax impact of sale of HSBC Argentina - - 1,536 4.8
Items reducing tax charge in 2025:
- non-taxable income and gains (970 ) (3.2 ) (1,079 ) (3.3 )
- effect of profits in associates and joint ventures (582 ) (1.9 ) (456 ) (1.4 )
- deductions for AT1 coupon payments (249 ) (0.8 ) (249 ) (0.8 )
- adjustments in respect of prior periods (86 ) (0.3 ) (46 ) (0.1 )
- non-taxable gain on disposal of HSBC Canada - - (1,174 ) (3.6 )
- impact of sale of French retail banking business - - (15 ) -
Year ended 31 Dec 6,776 22.7 7,310 22.6
The Group's profits are taxed at different rates depending on the country or
territory in which the profits arise. The key applicable tax rates for 2025
include Hong Kong (16.5%), the US (21.0%) and the UK (25.0%). If the Group's
profits were taxed at the statutory rates of the countries in which the
profits arose, then the tax rate for the year would have been 21.2% (2024:
21.4%).
The effective tax rate for the year of 22.7% was higher than in the previous
year (2024: 22.6%). The effective tax rate for the year was increased by 1.2%
by the dilution loss and non-deductible impairment of the Group's investment
in BoCom, increased by 1.0% by movements in unrecognised deferred tax,
primarily relating to French tax losses, and increased by 1.0% by the impact
of fines and provisions for legal settlements on which no tax benefit is
recorded. The effective tax rate for the year was reduced by 0.3% by
adjustments in respect of prior periods, mainly arising from the finalisation
of prior year tax returns in India and Hong Kong. The effective tax rate for
2024 was reduced by 3.6% by the non-taxable gain arising on the disposal of
HSBC Canada, increased by 4.8% by the non-deductible loss arising on the
disposal of HSBC Argentina, increased by 0.7% by movements in unrecognised
deferred tax, primarily relating to French tax losses, and increased by 0.7%
by the Group's Pillar 2 global minimum tax charge.
The UK adopted the 'Pillar Two' global minimum tax model rules of the OECD's
Inclusive Framework on Base Erosion and Profit-Shifting ('BEPS') with effect
from 1 January 2024. Many jurisdictions adopted similar rules, as well as
domestic minimum tax regimes, from 1 January 2025 and some jurisdictions, such
as Bermuda, introduced new or amended corporate income tax regimes effective
from that date. These changes have the effect of increasing local overseas tax
liabilities in 2025 and reducing the UK top-up tax liability.
Accounting for taxes involves some estimation because tax law is uncertain and
its application requires a degree of judgement, which authorities may dispute.
Liabilities are recognised based on best estimates of the probable outcome,
taking into account external advice where appropriate. Exposures to additional
tax liabilities arising from uncertain tax positions were reassessed during
2025, resulting in a charge of $118m to the income statement. We do not expect
significant liabilities to arise in excess of the amounts provided. HSBC only
recognises current and deferred tax assets where recovery is probable.
Movement of deferred tax assets and liabilities
Loan Unused tax Financial assets at FVOCI Cash flow hedges Retirement obligations Other Total
impairment losses and
provisions tax credits
$m $m $m $m $m $m $m
Assets 1,070 3,864 616 442 - 2,906 8,898
Liabilities - - - - (1,767 ) (1,607 ) (3,374 )
At 1 Jan 2025 1,070 3,864 616 442 (1,767 ) 1,299 5,524
Income statement 11 (466 ) 226 10 (96 ) 517 202
Other comprehensive income - - (564 ) (587 ) 6 161 (984 )
Foreign exchange and other adjustments (25 ) 74 221 23 (100 ) 200 393
At 31 Dec 2025 1,056 3,472 499 (112 ) (1,957 ) 2,177 5,135
Assets(1) 1,056 3,472 499 - - 3,503 8,530
Liabilities(1) - - - (112 ) (1,957 ) (1,326 ) (3,395 )
Assets 1,158 4,544 876 419 - 2,933 9,930
Liabilities - - - - (1,814 ) (1,600 ) (3,414 )
At 1 Jan 2024 1,158 4,544 876 419 (1,814 ) 1,333 6,516
Income statement (74 ) (640 ) 100 - (85 ) (431 ) (1,130 )
Other comprehensive income - - (49 ) 84 114 189 338
Foreign exchange and other adjustments (14 ) (40 ) (311 ) (61 ) 18 208 (200 )
At 31 Dec 2024 1,070 3,864 616 442 (1,767 ) 1,299 5,524
Assets(1) 1,070 3,864 616 442 - 2,906 8,898
Liabilities(1) - - - - (1,767 ) (1,607 ) (3,374 )
1 After netting off balances within countries, the balances as disclosed in
the accounts are as follows: deferred tax assets of $7,235m (2024: $6,841m)
and deferred tax liabilities of $2,100m (2024: $1,317m).
In applying judgement in recognising deferred tax assets, management has
assessed all relevant information, including future business profit
projections and the track record of meeting forecasts. Management's assessment
of the likely availability of future taxable profits against which to recover
deferred tax assets is based on the most recent financial forecasts approved
by management, which cover a five-year period and are extrapolated where
necessary, and takes into consideration the reversal of existing taxable
temporary differences and past business performance. When forecasts are
extrapolated beyond five years, a number of different scenarios are
considered, reflecting different downward risk adjustments, in order to assess
the sensitivity of our recognition and measurement conclusions in the context
of such longer-term forecasts.
The Group's net deferred tax asset of $5.1bn (2024: $5.5bn) included $1.5bn
(2024: $2.6bn) of deferred tax assets relating to the UK, $2.8bn (2024:
$3.0bn) of deferred tax assets relating to the US and a net deferred asset of
$0.8bn (2024: $0.5bn) in France.
The UK deferred tax asset of $1.5bn excluded a $2.0bn deferred tax liability
arising on the UK pension scheme surplus, the reversal of which is not taken
into account when estimating future taxable profit due to the level of
uncertainty as to the timing and manner of its reversal. The UK deferred tax
assets are supported by forecasts of taxable profit, also taking into
consideration the history of profitability in the relevant businesses. The
majority of the deferred tax asset relates to tax attributes which do not
expire and are forecast to be recovered within two years and as such are less
sensitive to changes in long-term profit forecasts.
The net US deferred tax asset of $2.8bn included $1.0bn related to US tax
losses, of which $0.7bn expire in nine to 12 years. Management expects the US
deferred tax asset to be substantially recovered within 13 years, with the
majority recovered in the first five years.
The net deferred tax asset in France of $0.8bn included $0.7bn related to tax
losses, which are expected to be substantially recovered within
10 years.
An additional $0.1bn of deferred tax asset relating to French tax losses was
recognised during the year, supported by the business's improved performance
and outlook. Unused tax losses with a tax value of $0.3bn have not been
recognised due to the absence of convincing evidence regarding the
availability of sufficient future taxable profits against which to recover
them.
Unrecognised deferred tax
The amount of gross temporary differences, unused tax losses and tax credits
for which no deferred tax asset is recognised in the balance sheet was $13.8bn
(2024: $11.0bn). This amount included unused US state tax losses of $3.8bn
(2024: $3.8bn) which are forecast to expire before they are recovered, unused
French tax losses of $1.4bn (2024: $0.7bn) for which there is insufficient
evidence of future taxable profits to support recognition, and unused UK tax
losses of $3.4bn (2024: $3.5bn), which arose prior to 1 April 2017 and can
only be recovered against future taxable profits of HSBC Holdings. No deferred
tax was recognised on these losses due to the absence of convincing evidence
regarding the availability of sufficient future taxable profits against which
to recover them. Deferred tax asset recognition is reassessed at each balance
sheet date based on the available evidence. Of the total amounts on which
deferred tax was not recognised, $7.6bn (2024: $6.0bn) had no expiry date,
$1.3bn (2024: $1.0bn) was scheduled to expire within 10 years and the
remaining balance is expected to expire after 10 years.
Deferred tax is not recognised in respect of the Group's investments in
subsidiaries and branches where HSBC is able to control the timing of
remittance or other realisation and where remittance or realisation is not
probable in the foreseeable future. The aggregate temporary differences
relating to unrecognised deferred tax liabilities arising on investments in
subsidiaries and branches was $15.9bn (2024: $15.2bn) and the corresponding
unrecognised deferred tax liability was $0.8bn (2024: $0.7bn).
3 Dividends
Dividends to shareholders of the parent company
2025 2024
Per Total Per Total
share share
$ $m $ $m
Dividends paid on ordinary shares
In respect of previous year:
- second interim dividend - - - -
- fourth interim dividend 0.36 6,397 0.31 5,872
In respect of current year:
- first interim dividend 0.10 1,750 0.10 1,877
- special dividend - - 0.21 3,942
- second interim dividend 0.10 1,717 0.10 1,852
- third interim dividend 0.10 1,717 0.10 1,805
Total 0.66 11,581 0.82 15,348
Total coupons on capital securities classified as equity 1,183 1,062
Dividends to shareholders 12,764 16,410
On 5 January 2026, HSBC paid a coupon on its €1,250m subordinated capital
securities, representing a total distribution of €30m ($35m). No liability
was recorded on the balance sheet at 31 December 2025 in respect of this
coupon payment.
Fourth interim dividend for 2025
On 25 February 2026, the Directors approved a fourth interim dividend in
respect of the financial year ended 31 December 2025 of $0.45 per ordinary
share (the 'dividend'), an expected distribution of approximately $7.71bn. The
dividend will be payable on 30 April 2026 to holders of record on the
Principal Register in the UK, the Hong Kong Overseas Branch Register or the
Bermuda Overseas Branch Register on 13 March 2026. No liability was recorded
in the financial statements in respect of the fourth interim dividend for
2025.
The dividend will be payable in US dollars, or in pounds sterling or Hong Kong
dollars at the forward exchange rates quoted by HSBC Bank plc in London at or
about 11.00am on 20 April 2026. The ordinary shares in London, Hong Kong and
Bermuda will be quoted ex-dividend on 12 March 2026. American Depositary
Shares ('ADSs') in New York will be quoted ex-dividend on 13 March 2026.
The default currency on the Principal Register in the UK is pounds sterling,
and dividends can also be paid in Hong Kong dollars or US dollars, or a
combination of these currencies. International shareholders can register to
join the Global Dividend Service to receive dividends in their local
currencies. Please register and read the terms and conditions at
www.investorcentre.co.uk. UK shareholders can also register their pounds
sterling bank mandates at www.investorcentre.co.uk.
The default currency on the Hong Kong Overseas Branch Register is Hong Kong
dollars, and dividends can also be paid in US dollars or pounds sterling, or a
combination of these currencies. Shareholders can arrange for direct credit of
Hong Kong dollar cash dividends into their bank account, or arrange to send US
dollar or pounds sterling cheques to the credit of their bank account.
Shareholders can register for these services at www.investorcentre.com/hk.
Shareholders can also download a dividend currency election form from
www.hsbc.com/dividends, www.investorcentre.com/hk, or www.hkexnews.hk.
The default currency on the Bermuda Overseas Branch Register is US dollars,
and dividends can also be paid in Hong Kong dollars or pounds sterling, or a
combination of these currencies. Shareholders can change their dividend
currency election by contacting the Bermuda investor relations team.
Shareholders can download a dividend currency election form from
www.hsbc.com/dividends.
Changes to currency elections must be received by 15 April 2026 to be
effective for this dividend.
The dividend will be payable on ADSs, each of which represents five ordinary
shares, on 30 April 2026 to holders of record on 13 March 2026. The dividend
of $2.25 per ADS will be payable by the depositary in US dollars.
Alternatively, the cash dividend may be invested in additional ADSs by
participants in the dividend reinvestment plan operated by the depositary.
Elections must be received by 10 April 2026.
Any person who has acquired ordinary shares registered on the Principal
Register in the UK, the Hong Kong Overseas Branch Register or the Bermuda
Overseas Branch Register but who has not lodged the share transfer with the
Principal Registrar in the UK, Hong Kong Overseas Branch Registrar or Bermuda
Overseas Branch Registrar should do so before 4.00pm local time on 13 March
2026 in order to receive the dividend.
Ordinary shares may not be removed from or transferred to the Principal
Register in the UK, the Hong Kong Overseas Branch Register or the Bermuda
Overseas Branch Register on 13 March 2026. Any person wishing to remove
ordinary shares to or from each register must do so before 4.00pm local time
on 12 March 2026.
Transfers of ADSs must be lodged with the depositary by 11.00am on 13 March
2026 in order to receive the dividend. ADS holders who receive a cash dividend
will be charged a fee, which will be deducted by the depositary, of $0.005 per
ADS per cash dividend.
4 Earnings per share
Basic earnings per ordinary share is calculated by dividing the profit
attributable to ordinary shareholders of the parent company by the weighted
average number of ordinary shares outstanding, after deducting own shares
held. Diluted earnings per ordinary share is calculated by dividing the basic
earnings, which require no adjustment for the effects of dilutive potential
ordinary shares, by the weighted average number of ordinary shares
outstanding, excluding own shares held, plus the weighted average number of
ordinary shares that would be issued on conversion of dilutive potential
ordinary shares.
Basic and diluted earnings per share
2025 2024
Profit Number of shares Per share Profit Number of shares Per share
$m (millions) $ $m (millions) $
Basic(1) 21,102 17,427 1.21 22,917 18,357 1.25
Effect of dilutive potential ordinary shares 120 128
Diluted(1) 21,102 17,547 1.20 22,917 18,485 1.24
1 Weighted average number of ordinary shares outstanding (basic) or assuming
dilution (diluted) after deducting own shares held.
The number of anti-dilutive employee share options excluded from the weighted
average number of dilutive potential ordinary shares was 12 million (2024:
Nil).
5 Constant currency balance sheet reconciliation
At
31 Dec 2025 31 Dec 2024
Reported and constant currency Constant currency Currency translation Reported
$m $m $m $m
Loans and advances to customers (net) 988,399 970,778 40,120 930,658
Interests in associates and joint ventures 29,577 29,728 819 28,909
Total external assets 3,233,034 3,139,801 122,753 3,017,048
Customer accounts 1,786,828 1,719,240 64,285 1,654,955
6 Reported and constant currency results(1)
Year ended
2025 2024
$m $m
Revenue(2)
Reported 68,274 65,854
Currency translation - 155
Constant currency 68,274 66,009
Change in expected credit losses and other credit impairment charges
Reported (3,850 ) (3,414 )
Currency translation - 22
Constant currency (3,850 ) (3,392 )
Operating expenses
Reported (36,428 ) (33,043 )
Currency translation - (103 )
Constant currency (36,428 ) (33,146 )
Share of profit in associates and joint ventures less impairment
Reported(3) 1,911 2,912
Currency translation - 1
Constant currency 1,911 2,913
Profit before tax
Reported 29,907 32,309
Currency translation - 75
Constant currency 29,907 32,384
1 In the current period constant currency results are equal to reported as
there is no currency translation.
2 Net operating income before change in expected credit losses and other
credit impairment charges, also referred to as revenue.
3 Amounts in 2025 relate to an impairment loss of $1.0bn recognised in respect
of the Group's investment in BoCom. See Note 19 on page 320 of the Annual
Report and Accounts 2025.
Notable items
Year ended
2025 2024
$m $m
Revenue
Disposals, wind-downs, acquisitions and related costs(1,2) (1,642 ) (1,343 )
Dilution loss of interest in BoCom associate(3) (1,104 ) -
Early redemption of legacy securities - (237 )
Operating expenses
Disposals, wind-downs, acquisitions and related costs (502 ) (199 )
Restructuring and other related costs(4) (1,030 ) (34 )
Legal provision(5) (1,432 ) -
Impairment losses of interest in BoCom associate(3) (1,000 ) -
Tax
Tax credit on notable items 440 108
1 Includes recycling of cumulative fair value losses of $1.5bn relating to the
French retained portfolio of home and certain other loans following the
completion of its sale to a consortium comprising Rothesay Life plc and CCF.
2 Amounts in 2024 include a $1.0bn loss on disposal and a $5.2bn loss on the
recycling in foreign currency translation reserve losses and other reserves
arising on sale of our business in Argentina. This was partly offset by a
$4.8bn gain on disposal of our banking business in Canada, inclusive of
foreign exchange hedging of the sales proceeds and the recycling of reserves
losses.
3 Includes a loss of $1.1bn inclusive of reserves recycling as a result of the
dilution of our shareholding in BoCom. We have also recognised a $1.0bn
impairment loss following an impairment test on the carrying value of the
Group's investment in BoCom in 'Impairment losses of interest in BoCom
associate'. See Note 18 on pages 319 to 322 of the Annual Report and Accounts
2025.
4 Amounts in 2025 include restructuring provisions recognised in 2025. Amounts
in 2024 relate to restructuring provisions recognised in 2024 and reversals of
restructuring provisions recognised during 2022.
5 Includes a $1.1bn provision in connection with a claim brought by Herald
Fund SPC in the Luxembourg District Court, relating to the Bernard L. Madoff
Investment Securities LLC fraud and a $0.3bn provision in connection with
certain historical trading activities in HSBC Bank plc.
7 Contingent liabilities, contractual commitments and guarantees
2025 2024
$m $m
Guarantees and other contingent liabilities:
- financial guarantees 17,476 16,998
- performance and other guarantees 102,684 92,723
- other contingent liabilities 164 298
At 31 Dec 120,324 110,019
Commitments(1):
- documentary credits and short-term trade-related transactions 6,959 7,096
- forward asset purchases and forward deposits placed 84,978 61,017
- standby facilities, credit lines and other commitments to lend 856,700 793,465
At 31 Dec 948,637 861,578
1 Includes $690.8bn of commitments at 31 December 2025 (31 December 2024:
$619.4bn), to which the impairment requirements in IFRS 9 are applied.
The preceding table discloses the nominal principal amounts of off-balance
sheet liabilities and commitments for the Group, which represent the maximum
amounts at risk should the contracts be fully drawn upon and the clients
default. As a significant portion of guarantees and commitments are expected
to expire without being drawn upon, the total of the nominal principal amounts
is not indicative of future liquidity requirements. The expected credit loss
provision relating to guarantees and commitments under IFRS 9 is disclosed in
Note 28 of the Annual Report and Accounts 2025.
The majority of the guarantees have a term of less than one year. All
guarantees are subject to HSBC's annual credit review process.
Contingent liabilities arising from legal proceedings, regulatory and other
matters against Group companies are excluded from this note but are disclosed
in Notes 28 and 35 of the Annual Report and Accounts 2025.
Financial Services Compensation Scheme
The Financial Services Compensation Scheme ('FSCS') provides compensation, up
to certain limits, to eligible customers of financial services firms that are
unable, or likely to be unable, to pay claims against them. The FSCS may
impose a further levy on the Group to the extent the industry levies imposed
to date are not sufficient to cover the compensation due to customers in any
future possible collapse. The ultimate FSCS levy to the industry as a result
of a collapse cannot be estimated reliably. It is dependent on various
uncertain factors including the potential recovery of assets by the FSCS,
changes in the level of protected products (including deposits and
investments) and the population of FSCS members at the time.
Associates
HSBC's share of associates' contingent liabilities, contractual commitments
and guarantees amounted to $70.9bn at 31 December 2025 (2024: $74.5bn). No
matters arose where HSBC was severally liable.
8 Legal proceedings and regulatory matters
HSBC is party to legal proceedings and regulatory matters in a number of
jurisdictions arising out of its normal business operations. Apart from the
matters described below, HSBC considers that none of these matters are
material. The recognition of provisions is determined in accordance with the
accounting policies set out in Note 1 of the Annual Report and Accounts 2025.
While the outcomes of legal proceedings and regulatory matters are inherently
uncertain, management believes that, based on the information available to it,
appropriate provisions have been made in respect of these matters as at 31
December 2025 (see Note 28 of the Annual Report and Accounts 2025). Where an
individual provision is material, the fact that a provision has been made is
stated and quantified, except to the extent that doing so would be seriously
prejudicial. Any provision recognised does not constitute an admission of
wrongdoing or legal liability. It is not practicable to provide an aggregate
estimate of potential liability for our legal proceedings and regulatory
matters as a class of contingent liabilities.
Bernard L. Madoff Investment Securities LLC
Various HSBC companies that provided custodial, administration and similar
services to a number of funds whose assets were invested with Bernard L.
Madoff Investment Securities LLC ('Madoff Securities') have been named as
defendants in lawsuits arising out of Madoff Securities' fraud.
Trustee litigation: The Madoff Securities trustee (the 'Trustee') has brought
lawsuits in the US against various HSBC companies and others seeking recovery
of alleged transfers from Madoff Securities to the HSBC companies in the
amount of $508m (plus interest). In September 2025, the US Bankruptcy Court
for the Southern District of New York dismissed all claims against HSBC
Private Bank (Suisse) SA in the amount of $292m and certain claims against
HSBC Bank USA N.A. ('HSBC Bank USA') in the amount of $32m. The Trustee has
appealed. The Trustee's remaining claims, which amount to $184m, are pending.
The Trustee has filed a claim against various HSBC companies in the High Court
of England and Wales seeking recovery of alleged transfers from Madoff
Securities to the HSBC companies. The claim has not yet been served and the
amount claimed has not been specified.
Fairfield Funds litigation: Fairfield Sentry Limited, Fairfield Sigma Limited
and Fairfield Lambda Limited (each in liquidation and together, the 'Fairfield
Funds') have brought lawsuits in the US against various HSBC companies and
others seeking recovery of alleged transfers from the Fairfield Funds to the
HSBC companies (that acted as nominees for clients) in the amount of $382m
(plus interest). In August 2025, the US Court of Appeals for the Second
Circuit confirmed the dismissal of Fairfield Funds' claims against all HSBC
companies. Fairfield Funds may appeal.
Herald Fund SPC ('Herald') litigation: HSBC Securities Services Luxembourg
('HSSL') and HSBC Bank plc are defending an action brought by Herald (in
liquidation) before the Luxembourg District Court seeking restitution of
securities (the amount of which would be determined by further proceedings, if
Herald is successful in its claim) and $521m in cash (plus interest) or,
alternatively, damages in the amount of $5.6bn (plus interest). Herald's
damages claim against HSSL and HSBC Bank plc has been stayed. In December
2024, the Luxembourg Court of Appeal determined that Herald's claims for
restitution of securities and cash against HSSL were founded in principle.
HSSL appealed this decision and, in October 2025, the Luxembourg Court of
Cassation denied HSSL's appeal in respect of Herald's securities restitution
claim, but accepted HSSL's appeal in respect of Herald's cash restitution
claim, which has been returned to the Luxembourg District Court for
determination. HSSL is pursuing a second appeal on the securities restitution
claim before the Luxembourg Court of Appeal. Following the Court of
Cassation's decision, HSSL has recognised a $1.1bn provision in connection
with this matter. Given the pendency of the second appeal and the complexities
and uncertainties associated with determining the quantum of restitution, the
eventual financial impact could be significantly different.
Alpha Prime Fund Limited ('Alpha Prime') litigation: Various HSBC companies
are defending an action brought by Alpha Prime in the Luxembourg District
Court seeking restitution of securities and $1bn (plus interest) in
supplementary damages or, alternatively, damages in the amount of $3.3bn (plus
interest). This matter is currently pending before the Luxembourg District
Court.
In November 2024, Alpha Prime served various HSBC companies with a lawsuit
filed in the Bermuda Supreme Court seeking damages for unspecified amounts for
alleged breach of contract and negligence. This claim is currently stayed.
Senator Fund SPC ('Senator') litigation: HSSL and the Luxembourg branch of
HSBC Bank plc are defending an action brought by Senator before the Luxembourg
District Court seeking restitution of securities or, alternatively, damages in
the amount of $1.4bn (plus interest). This matter is currently pending before
the Luxembourg District Court.
Based on the facts currently known, it is not practicable at this time for
HSBC to predict the resolution of these matters, including the timing or any
possible impact on HSBC, which could be significant.
US Anti-Terrorism Act litigation
Since November 2014, a number of lawsuits have been filed in federal courts in
the US against various HSBC companies and others on behalf of plaintiffs who
are, or are related to, alleged victims of terrorist attacks in the Middle
East. In each case, it is alleged that the defendants aided and abetted the
unlawful conduct of various sanctioned parties in violation of the US
Anti-Terrorism Act, or provided banking services to customers alleged to have
connections to terrorism financing. Six actions, which seek damages for
unspecified amounts, remain pending. One of these actions has been dismissed
but may be appealed. The other five actions remain at an early procedural
stage.
Based on the facts currently known, it is not practicable at this time for
HSBC to predict the resolution of these matters, including the timing or any
possible impact on HSBC, which could be significant.
US dollar Libor litigation
Various HSBC companies are defending two individual actions which allege that
the HSBC defendants violated various US federal and state laws, including
antitrust laws, related to the setting of US dollar Libor, and seek damages
for unspecified amounts. In September 2025, the US District Court for the
Southern District of New York granted the defendants' joint motion for summary
judgment and dismissed these actions. The plaintiffs have appealed.
Based on the facts currently known, it is not practicable at this time for
HSBC to predict the resolution of these matters, including the timing or any
possible impact on HSBC, which could be significant.
Foreign exchange-related investigations and litigation
In December 2016, Brazil's Administrative Council of Economic Defense
initiated an investigation into the onshore foreign exchange market and
identified a number of banks, including HSBC, as subjects of its
investigation. This investigation is ongoing. Lawsuits alleging foreign
exchange-related misconduct remain pending against HSBC and other banks in
courts in Brazil.
Since 2017, HSBC Bank plc, among other financial institutions, has been
defending a complaint filed by the Competition Commission of South Africa
before the South African Competition Tribunal for alleged anti-competitive
behaviour in the South African foreign exchange market. In 2020, a revised
complaint was filed which also named HSBC Bank USA as a defendant. In January
2024, the South African Competition Appeal Court dismissed HSBC Bank USA from
the revised complaint but denied HSBC Bank plc's application to dismiss. Both
the Competition Commission and HSBC Bank plc have appealed to the
Constitutional Court of South Africa.
HSBC Bank plc and HSBC Holdings have reached a settlement with plaintiffs in
Israel to resolve a class action filed in the local courts alleging foreign
exchange-related misconduct. The settlement, the impact of which is not
significant and is fully provisioned, remains subject to court approval.
In February 2024, HSBC Bank plc and HSBC Holdings were joined to an existing
claim brought in the UK Competition Appeals Tribunal ('UK CAT') against
various other banks alleging historical anti-competitive behaviour in the
foreign exchange market and seeking approximately £3bn in damages from all
the defendants. In December 2025, the UK Supreme Court upheld an earlier
ruling of the UK CAT refusing certification as an opt-out claim. This matter
remains pending before the UK CAT.
Based on the facts currently known, it is not practicable at this time for
HSBC to predict the resolution of these matters, including the timing or any
possible impact on HSBC, which could be significant.
Precious metals fix-related litigation
US litigation: Various HSBC companies and other members of The London Silver
Market Fixing Limited are defending a class action pending in the US District
Court for the Southern District of New York alleging that, from January 2007
to December 2013, the defendants conspired to manipulate the price of silver
and silver derivatives for their collective benefit in violation of US
antitrust laws, the US Commodity Exchange Act and New York state law. In May
2023, this action, which seeks damages for unspecified amounts, was dismissed
but remains pending on appeal. Based on the facts currently known, it is not
practicable at this time for HSBC to predict the resolution of this matter,
including the timing or any possible impact on HSBC, which could be
significant.
Canada litigation: Various HSBC companies and other financial institutions
have been defending putative class actions filed in the Ontario and Quebec
Superior Courts of Justice alleging that the defendants conspired to
manipulate the price of silver, gold and related derivatives in violation of
the Canadian Competition Act and common law. These actions each seek CA$1bn in
damages plus CA$250m in punitive damages. The HSBC defendants have reached a
settlement with the plaintiffs to resolve these matters. The settlement, the
impact of which is not significant and is fully provisioned, is subject to
court approval.
Tax-related investigations
Since 2023, the French National Financial Prosecutor ('PNF') had been
investigating HSBC Continental Europe and the Paris branch of HSBC Bank plc,
in connection with alleged tax fraud related to the dividend withholding tax
treatment of certain trading activities. In January 2026, HSBC Bank plc
reached an agreement with the PNF to resolve its investigation. HSBC Bank plc
paid a total of €302m and this matter is now closed. The investigation into
HSBC Continental Europe was closed with no further action.
HSBC Bank plc and the German branch of HSBC Continental Europe continue to
cooperate with investigations by the German public prosecutor into numerous
financial institutions and their employees, in connection with the dividend
withholding tax treatment of certain trading activities. Based on the facts
currently known, it is not practicable at this time for HSBC to predict the
resolution of this matter, including the timing or any possible impact on
HSBC, which could be significant.
Gilts trading litigation
In June 2023, HSBC Bank plc and HSBC Securities (USA) Inc., among other banks,
were named as defendants in a putative class action filed in the US District
Court for the Southern District of New York by plaintiffs alleging
anti-competitive conduct in the gilts market and seeking damages for
unspecified amounts. Certain of the defendants, including HSBC Bank plc and
HSBC Securities (USA) Inc., have reached a settlement with the plaintiffs to
resolve this matter. The settlement, the impact of which is not significant
and has been paid, remains subject to final court approval.
Korean short selling indictment
In March 2024, the Korean Prosecutors' Office issued a criminal indictment
against The Hongkong and Shanghai Banking Corporation Limited ('HBAP') and
three current and former employees for breaching short selling rules under the
Financial Investment Services and Capital Markets Act in connection with
trades carried out between August 2021 and December 2021. In September 2025,
the Korean appellate court confirmed the acquittal of HBAP of all charges. The
Korean Prosecutors' Office has further appealed to the Korean Supreme Court.
Investigations involving HSBC Private Bank (Suisse) SA
Law enforcement authorities in Switzerland and France are conducting criminal
investigations into HSBC Private Bank (Suisse) SA in connection with alleged
money laundering offences in respect of two historical banking relationships.
These investigations are ongoing.
Based on the facts currently known, it is not practicable at this time for
HSBC to predict the resolution of these matters, including the timing or any
possible impact on HSBC, which could be significant.
First Citizens litigation
In May 2023, First-Citizens Bank & Trust Company ('First Citizens')
brought a lawsuit in the US District Court for the Northern District of
California against various HSBC companies and seven US-based HSBC employees
who had previously worked for Silicon Valley Bank ('SVB'). The lawsuit seeks
$1bn in damages and alleges, among other things, that the various HSBC
companies conspired with the individual defendants to solicit employees from
First Citizens and that the individual defendants took confidential
information belonging to SVB and/or First Citizens. In January 2026, First
Citizens amended its complaint to add claims purportedly assigned by the
Federal Deposit Insurance Corporation ('FDIC'). These include claims
concerning the period between SVB's entry into FDIC receivership and First
Citizens' purchase of SVB's US assets. First Citizens also seeks to bring
certain claims and defendants dismissed by the court in July 2024 back into
the litigation. The defendants have filed a motion to dismiss the amended
complaint.
Based on the facts currently known, it is not practicable at this time for
HSBC to predict the resolution of this matter, including the timing or any
possible impact on HSBC, which could be significant.
US mortgage securitisation litigation
Beginning in 2014, a number of lawsuits were filed in various state and
federal courts in the US against HSBC Bank USA, as a trustee of more than 280
mortgage securitisation trusts, seeking unspecified damages for losses in
collateral value allegedly sustained by the trusts. Nearly all of these
lawsuits have either been settled or dismissed; one action remains pending in
a New York state court.
HSBC Bank USA and certain of its affiliates are named as defendants in a
mortgage loan repurchase action brought by the trustee of a mortgage
securitisation trust in New York state court and seeking unspecified damages
and specific performance. The plaintiff has appealed the dismissal of this
action, and the appeal is pending.
Based on the facts currently known, it is not practicable at this time for
HSBC to predict the resolution of these matters, including the timing or any
possible impact on HSBC, which could be significant.
Mexican government bond litigation
HSBC Mexico S.A. and other banks are named as defendants in a consolidated
putative class action pending in the US District Court for the Southern
District of New York alleging anti-competitive conduct related to Mexican
government bond transactions between 2010 and 2014 and seeking unspecified
damages. In January 2025, the court denied the defendants' motion to dismiss
the plaintiffs' third amended complaint, and this action is proceeding.
Based on the facts currently known, it is not practicable at this time for
HSBC to predict the resolution of this matter, including the timing or any
possible impact on HSBC, which could be significant.
Other regulatory investigations, reviews and litigation
HSBC Holdings and/or certain of its affiliates are also subject to a number of
other enquiries and examinations, requests for information, investigations and
reviews by various tax authorities, regulators, competition and law
enforcement authorities, as well as legal proceedings including litigation,
arbitration and other contentious proceedings, in connection with various
matters arising out of their businesses and operations.
At the present time, HSBC does not expect the ultimate resolution of any of
these matters to be material to the Group's financial position; however, given
the uncertainties involved in legal proceedings and regulatory matters, there
can be no assurance regarding the eventual outcome of a particular matter or
matters.
9 Impairment of interest in associate
The results for the period ended 31 December 2025 included a $1.1bn loss from
the dilution of our shareholding and a $1.0bn impairment to the carrying
amount of the Group's interest in BoCom.
The Group's interest in BoCom reduced from 19.03% to 16.00% following the
completion of a capital issuance by BoCom on 17 June 2025. The dilution of the
Group's interest resulted in a pre-tax loss of $1.1bn, recognised in 'Other
operating income/(expense)' in the Group's consolidated income statement. The
loss is not deductible for tax purposes as a consequence of our shareholding
in BoCom being held for long-term investment purposes.
In addition, the Group's impairment test on the carrying amount at 30 June
2025 resulted in an impairment of $1.0bn as the recoverable amount as
determined by a value-in-use calculation was lower than the carrying amount.
The impairment was recognised within 'Impairment of interest in associate'.
Consistent with prior periods, our value-in-use ('VIU') calculation uses both
historical experience and market participant views to estimate future cash
flows, relevant discount rates and associated capital assumptions. No further
impairment (or reversal) was required for the period from 1 July 2025 to 31
December 2025 based on results of the quarterly impairment tests performed.
The impacts of the capital issuance have been incorporated in both the
carrying amount and the VIU. The VIU assumptions incorporate updated
expectations, taking into account both the impact of the capital issuance on
BoCom's financial position, and the latest macroeconomic, policy and industry
factors in mainland China.
We remain strategically committed to mainland China and continue our valued,
strategic partnership with BoCom.
Ñ For further details, see Note 18: Interests in associates and joint
ventures on page 319 of our Annual Report and Accounts 2025.
10 Events after the balance sheet date
On 8 January 2026, the proposal to privatise Hang Seng Bank Limited ('Hang
Seng Bank') through a scheme of arrangement was approved by Hang Seng Bank
shareholders. On approval, a financial liability was recognised in the Group's
consolidated financial statements for the present value of the proposed
HK$106bn ($13.7bn) purchase consideration. A corresponding adjustment to
equity, net of derecognising the non-controlling interest, which stood at
$7.0bn as at 31 December 2025, was also recognised. On 26 January 2026, the
scheme of arrangement became effective and Hang Seng Bank was subsequently
delisted from The Stock Exchange of Hong Kong Limited on 27 January 2026. To
demonstrate funding availability for the proposal, securities of HK$129.3bn
($16.6bn) were segregated and reported as encumbered on the balance sheet as
at 31 December 2025. These assets were designated to demonstrate that
sufficient resources were available at all times to settle the acquisition
consideration and to provide a buffer against potential mark-to-market
movements. The transaction was settled on 4 February 2026. At that point, all
payment obligations under the scheme of arrangement were met, and the
segregation of assets ceased.
On 30 January 2026, HSBC Bank plc completed the sale of its UK life insurance
entity, HSBC Life (UK) Limited, to Chesnara plc. Prior to completion, as at 31
December 2025, the balances that were classified as held for sale were $6.6bn
in assets and $6.4bn in liabilities. For the year ended 31 December 2025, we
recognised a loss on disposal of $0.1bn. In the first quarter of 2026, we will
recycle foreign currency translation reserves to the income statement. These
stood at a cumulative $0.2bn loss as at 31 December 2025.
A fourth interim dividend for 2025 of $0.45 per ordinary share (a distribution
of approximately $7.71bn) was approved by the Directors after 31 December
2025. On 11 February 2026, HSBC Holdings called $1,000m 4.000% perpetual
subordinated contingent convertible securities, which are expected to be
redeemed and cancelled on 9 March 2026. The accounts were approved by the
Board of Directors on 25 February 2026 and authorised for issue.
11 Capital structure
Capital ratios
At 31 Dec
2025 2024
% %
Transitional basis
Common equity tier 1 ratio 14.9 14.9
Tier 1 ratio 17.3 17.2
Total capital ratio 20.5 20.6
End point basis
Common equity tier 1 ratio 14.9 14.9
Tier 1 ratio 17.3 17.2
Total capital ratio 20.5 20.1
Total regulatory capital and risk-weighted assets
At 31 Dec
2025 2024
$m $m
Transitional basis
Common equity tier 1 capital 132,593 124,911
Additional tier 1 capital 20,804 19,216
Tier 2 capital 28,974 28,259
Total regulatory capital 182,371 172,386
Risk-weighted assets 888,647 838,254
End point basis
Common equity tier 1 capital 132,593 124,911
Additional tier 1 capital 20,804 19,216
Tier 2 capital 28,974 24,401
Total regulatory capital 182,371 168,528
Risk-weighted assets 888,647 838,254
Leverage ratio
At 31 Dec
2025 2024
$bn $bn
Tier 1 capital 153.4 144.1
Total leverage ratio exposure 2,877.1 2,571.1
% %
Leverage ratio 5.3 5.6
12 Statutory accounts
The information in this news release does not constitute statutory accounts
within the meaning of section 434 of the Companies Act 2006 ('the Act'). The
statutory accounts for the year ended 31 December 2025 will be delivered to
the Registrar of Companies in England and Wales in accordance with section
441 of the Act. The auditor has reported on those accounts. Its report was
unqualified and did not contain a statement under section 498(2) or (3) of the
Act.
13 Dealings in HSBC Holdings plc listed securities
The Group has policies and procedures that, except where permitted by statute
and regulation, prohibit specified transactions in respect of its securities
listed on The Stock Exchange of Hong Kong Limited. Except for dealings as
intermediaries or as trustees by subsidiaries of HSBC Holdings, and purchases
by HSBC Holdings under the share buy-backs, neither HSBC Holdings nor any of
its subsidiaries has purchased, sold or redeemed any of its securities listed
on The Stock Exchange of Hong Kong Limited during the year ended 31 December
2025.
14 Interim dividends for 2026
We maintain our dividend policy of a target payout ratio of 50% earnings per
ordinary share ('EPS') for each of 2026, 2027 and 2028, subject to meeting
capital requirements. EPS for this purpose will continue to exclude material
notable items and related impacts.
For the financial year 2025, dividends were paid in accordance with our
dividend policy. We achieved a dividend payout ratio of 50% of EPS, excluding
material notable items and related impacts. Material notable items in 2025
primarily related to the income statement impacts associated with actions to
exit or wind-down non-strategic businesses. They also include a dilution loss
and the recognition of an impairment of our investment in BoCom, a legal
provision relating to the Bernard L. Madoff Investment Securities LLC fraud,
as well as the impacts of transactions completed in previous periods,
including the sale of our retail banking operations in France, the sale of our
banking business in Canada and the disposal of our business in Argentina.
The Board has adopted a dividend policy designed to provide sustainable cash
dividends, while retaining the flexibility to invest and grow the business in
the future, supplemented by additional shareholder distributions, if
appropriate.
Dividends are approved in US dollars and, at the election of the shareholder,
paid in cash in one of, or in a combination of, US dollars, pounds sterling
and Hong Kong dollars.
15 Distributable reserves
The distributable reserves of HSBC Holdings at 31 December 2025 were $46.2bn,
a $17.9bn increase since 31 December 2024. This was primarily driven by
$22.1bn in profits and other reserves movements generated in 2025,
cancellation of $16.6bn standing to the credit share premium and capital
redemption reserves pursuant to the Court approval obtained by HSBC Holdings
on 24 June 2025, offset by $20.8bn of dividends on ordinary shares, additional
tier 1 coupon and share buy-back payments.
16 Earnings releases and interim results
First and third quarter results for 2026 will be released on 5 May 2026 and 27
October 2026, respectively. The interim results for the six months to 30 June
2026 will be issued on 4 August 2026.
17 Corporate governance codes
The Board considers that, during 2025, HSBC fully complied with both the UK
and Hong Kong Corporate Governance Codes, with the exception of Provision 24
of the UK Corporate Governance Code in relation to the Group Chairman being a
member of the Group Audit Committee.
Under the Hong Kong Corporate Governance Code, the audit committee should be
responsible for the oversight of all risk management and internal control
systems. The Group Audit Committee's responsibilities cover oversight of the
effectiveness of all internal controls. The Group Risk Committee has
responsibility for oversight of internal controls relating to risk management
and risk management systems and provides input to the Group Audit Committee on
these.
HSBC Holdings plc has codified obligations for transactions in Group
securities in accordance with the requirements of the UK Market Abuse
Regulation and the rules governing the listing of securities on HKEx. The
Group has been granted certain waivers by HKEx from strict compliance with the
rules that take into account accepted practices in the UK, particularly in
respect of employee share plans. During the year, all Directors were reminded
of their obligations in respect of transacting in HSBC Group securities.
Following specific enquiry all Directors have confirmed that they have
complied with their obligations.
The Group Audit Committee has reviewed and provided assurance to support the
HSBC Holdings Board's approval and publication of the Annual Report and
Accounts 2025.
The Directors of HSBC Holdings plc as at the date of this announcement
comprise:
Brendan Robert Nelson*, Georges Bahjat Elhedery, Geraldine Joyce
Buckingham(†), Wei Sun Christianson(†), Rachel Duan(†), Dame Carolyn
Julie Fairbairn(†), James Anthony Forese(†), Ann Frances Godbehere(†),
Steven Craig Guggenheimer(†), Manveen (Pam) Kaur, Dr José Antonio Meade
Kuribreña(†), Kalpana Jaisingh Morparia(†), Eileen K Murray(†) and Swee
Lian Teo(†).
* Independent non-executive Chairman
† Independent non-executive Director
18 Cautionary statement regarding forward-looking statements
This news release may contain projections, estimates, forecasts, targets,
commitments, ambitions, opinions, prospects, results, returns and
forward-looking statements with respect to the financial condition, results of
operations, capital position, environmental, social and governance ('ESG')-
related matters, strategy and business of the Group which can be identified by
the use of forward-looking terminology such as 'may', 'will', 'should',
'expect', 'anticipate', 'project', 'estimate', 'seek', 'intend', 'target',
'plan', 'believe', 'potential' or 'reasonably possible', or the negatives
thereof or other variations thereon or comparable terminology (together,
'forward-looking statements'), including the strategic priorities and any
financial, investment and capital targets and any ESG ambitions, targets and
commitments described herein.
Any such forward-looking statements are not a reliable indicator of future
performance, as they may involve significant stated or implied assumptions and
subjective judgements which may or may not prove to be correct. There can be
no assurance that any of the matters set out in forward-looking statements are
attainable, will actually occur or will be realised or are complete or
accurate. The assumptions and judgements may prove to be incorrect and involve
known and unknown risks, uncertainties, contingencies and other important
factors, many of which are outside the control of the Group.
Actual achievements, results, performance or other future events or conditions
may differ materially from those stated, implied and/or reflected in any
forward-looking statements due to a variety of risks, uncertainties and other
factors (including, without limitation, those which are referable to general
market or economic conditions, regulatory and government policy changes,
continued volatility in trade and tariff policies, increased volatility in
interest rates and inflation levels and other macroeconomic risks,
geopolitical tensions such as the Russia-Ukraine war, further conflict in the
Middle East or elsewhere, specific economic developments, such as the
uncertain performance of the commercial real estate sector in mainland China
and Hong Kong, or the efficacy of the Group's actions in managing and
mitigating ESG-related risks, and in progressing towards the Group's ESG
ambitions, targets and commitments.
Any such forward-looking statements are based on the beliefs, expectations and
opinions of the Group at the date the statements are made, and the Group does
not assume, and hereby disclaims, any obligation or duty to update, revise or
supplement them if circumstances or management's beliefs, expectations or
opinions should change. For these reasons, recipients should not place
reliance on, and are cautioned about relying on, any forward-looking
statements. No representations or warranties, expressed or implied, are given
by or on behalf of the Group as to the achievement or reasonableness of any
projections, estimates, forecasts, targets, commitments, ambitions, prospects
or returns contained herein.
Additional detailed information concerning important factors, including but
not limited to ESG-related factors, that could cause actual results to differ
materially from this news release is available in our Annual Report and
Accounts for the fiscal year ended 31 December 2025, which we expect to file
with the US Securities and Exchange Commission on Form 20-F on or around 26
February 2026.
19 Use of alternative performance measures
This news release contains non-IFRS measures used by management internally
that constitute alternative performance measures under European Securities and
Markets Authority guidance and non-GAAP financial measures defined in and
presented in accordance with US Securities and Exchange Commission rules and
regulations ('alternative performance measures'). The primary alternative
performance measures we use are presented on a 'constant currency' basis which
is computed by adjusting reported results for the effects of foreign currency
translation differences, which distort period-on-period comparisons. We
consider constant currency performance to provide useful information for
investors by aligning internal and external reporting, and reflecting how
management assesses period-on-period performance. We separately disclose
'notable items', which are components of our income statement that management
would consider as outside the normal course of business and generally
non-recurring in nature. Reconciliations between alternative performance
measures and the most directly comparable measures under IFRS are provided in
our Annual Report and Accounts 2025, which is available at www.hsbc.com.
20 Certain defined terms
Unless the context requires otherwise, 'HSBC Holdings' means HSBC Holdings plc
and 'HSBC', the 'Group', 'we', 'us' and 'our' refer to HSBC Holdings together
with its subsidiaries. Within this document the Hong Kong Special
Administrative Region of the People's Republic of China is referred to as
'Hong Kong'. When used in the terms 'shareholders' equity' and 'total
shareholders' equity', 'shareholders' means holders of HSBC Holdings ordinary
shares and those preference shares and capital securities issued by HSBC
Holdings classified as equity. The abbreviations '$m', '$bn' and '$tn'
represent millions, billions (thousands of millions) and trillions of US
dollars, respectively.
21 For further information contact:
Media Relations Investor Relations
UK - HSBC Group Press Office UK - Alastair Ryan
Telephone: +44 (0)20 7991 8096 Telephone: +44 (0)7468 703 010
Email: pressoffice@hsbc.com Email: investorrelations@hsbc.com
Hong Kong - Aman Ullah Hong Kong - Yafei Tian
Telephone: +852 3941 1120 Telephone: +852 2899 8909
Email: aspmediarelations@hsbc.com.hk Email: investorrelations@hsbc.com.hk
22 Registered Office and Group Head Office
8 Canada Square
London E14 5HQ
United Kingdom
Web: www.hsbc.com
Incorporated in England and Wales with limited liability. Registration number
617987
Please click on the following link to view the associated data pack:
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(http://www.rns-pdf.londonstockexchange.com/rns/3236U_1-2026-2-25.pdf)
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