Company: HBCYF
Filing Date: 2025-07-30
Form Type: 6-K
Source: 0001089113-25-000052
Chunk: 32

Company: HSBC HOLDINGS PLC
Filing Date: 2025-07-30
Form: 6-K
Chunk 32
---
 the Middle East and the Russia-Ukraine war remain key sources of uncertainty, which may impact HSBC and our customers, including through increased market volatility and supply chain disruptions. During the second quarter of 2025, the war between Israel and Iran illustrated the threat of energy supply disruption to the global economy. Heightened strategic competition between the US and China is also affecting the configuration of global supply chains, which may in turn affect the Group’s operations. Existing and additional sanctions, trade restrictions, counter-sanctions and other retaliatory measures relating to geopolitical tensions may adversely affect the Group, its customers and the markets in which the Group operates. Commercial real estate conditions remain challenging in Hong Kong and mainland China. In Hong Kong, the over-supply of non- residential properties continued putting downward pressure on rental and capital values. In mainland China, government stimulus has yet to trigger material improvement in buyer sentiment. For further details on market conditions, see page 62 . In the first half of 2025, management adjustments to ECL were applied to reflect sector or portfolio risks that are not fully captured by our models. We continue to monitor, and seek to manage, the potential implications of all the above developments on our customers and our business. Our risk appetite At 30 June 2025, our CET1 ratio and ECL charges were within their defined risk appetite thresholds. At 30 June 2025 our CET1 ratio decreased to 14.6 % from 14.9 % at 31 December 2024 driven by an increase in risk-weighted assets (‘RWAs‘), partly offset by an increase in CET1 capital. Wholesale and Retail ECL charges were within appetite at 0.45% and 0.35% of loans and advances respectively. Our operations We remain committed to investing in the reliability and resilience of our technology systems and critical services, including our ability to withstand and respond to cyber- attacks. We assess our third parties to help ensure they deliver the standard of services we require to provide resilient services to our customers. We do so to help protect our customers and counterparties, and to help ensure that we minimise any disruption to our services. In our approach to defending against these threats, we invest in business and technical controls to help us detect, prevent, manage and recover from issues in a timely manner within our risk appetite. HSBC is committed to using AI responsibly. We are working to balance the opportunity AI presents to accelerate delivery of our strategy with the need for appropriate controls to help mitigate the associated risks.