Company: HBCYF
Filing Date: 2025-06-02
Form Type: 424B5
Source: 0001193125-25-132352
Chunk: 43

Company: HSBC HOLDINGS PLC
Filing Date: 2025-06-02
Form: 424B5
Chunk 43
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 the cancellation (in whole or in part) of interest payments in
respect of the Securities.

Changes to the capital and leverage frameworks may increase our capital requirements and may increase the risk
that we will be subject to restrictions on distributions, resulting in our being required to cancel (in whole or in part) interest payments in respect of the Securities. Following the UK’s withdrawal from the EU, the UK regime continues to
develop, with the PRA taking an increasingly significant role in developing the relevant rules. As a result of powers granted by the Financial Services Act 2021, the PRA has revoked elements of UK CRR (as defined under “Description of the Securities—Definitions”), as it stood as of IP Completion Day, and replaced them with PRA-made rules. In July 2020, the Basel Committee on Banking Supervision completed the reforms to the Basel
III standards (“Basel 3.1”). In the UK, a two stage approach to implementation has been adopted for these changes. Amendments to UK CRR along with corresponding new PRA rules, which took effect from January 1, 2022, represented the
first tranche of changes to implement Basel 3.1. This included the standardized approach for measuring counterparty risk, the equity investments in funds rules, amendments to the large exposures rules, and the implementation of the net stable
funding ratio. The remaining elements of Basel 3.1 will be implemented as a second tranche of changes. This includes changes to the market risk rules under the Fundamental Review of the Trading Book, changes to the rules on credit risk, operational
risk and credit valuation adjustment, and the implementation of the output floor. On November 30, 2022, the PRA published Consultation Paper CP16/22 concerning the implementation of the remaining elements of Basel 3.1 and subsequently published
the first part of its near-final policy statement PS17/23 on December 12, 2023 which only partly addressed the subject matter of CP16/22. The second part of the PRA’s near-final policy statement (PS9/24) was published on September 12,
2024. PS9/24 covers a revised standardized approach and internal ratings-based approach for credit risk, credit risk mitigation and the implementation of an output floor requiring reported risk weighted assets calculated under internal model
approaches to be a minimum of 72.5% of fully standardized calculations. PS9/24 also includes updates to the UK Pillar 3 disclosure requirements