Company: HBCYF
Filing Date: 2025-07-30
Form Type: 6-K
Source: 0001089113-25-000052
Chunk: 74

Company: HSBC HOLDINGS PLC
Filing Date: 2025-07-30
Form: 6-K
Chunk 74
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, and a corresponding allowance for ECL of $ 46 m,

reflecting planned business disposals as disclosed in Note 15 on page 98 .

2 Total includes $ 35.3b n of nominal amount and $ 21m of corresponding allowance for ECL related to derecognition of loan commitments and financial guarantees

following the sale of our banking business in Canada during 2024.

3 Total includes $ 2.7b n of nominal amount related to derecognition of loan commitments and financial guarantees following the sale of our banking business in

Argentina during 2024.

4 The 31 December 2024 total ECL income statement change of $ 3,133m is attributable to $ 882m for the six months ended 30 June 2024 and $ 2,251m to the six

months ended 31 December 2024.

Credit quality of financial instruments We assess the credit quality of all financial instruments that are subject to credit risk. The credit quality of financial instruments is a point-in-time assessment of PD, whereas stages 1 and 2 are determined based on relative deterioration of credit quality since initial recognition. Accordingly, for non-credit-impaired financial instruments, there is no direct relationship between the credit quality assessment and stages 1 and 2, though typically the lower credit quality bands exhibit a higher proportion in stage 2. The five credit quality classifications each encompass a range of granular internal credit rating grades assigned to wholesale and personal lending businesses and the external ratings attributed by external agencies to debt securities, as shown in the following table. Personal lending credit quality is disclosed based on a 12-month point- in-time PD adjusted for multiple economic scenarios. The credit quality classifications for wholesale lending are based on internal credit risk ratings.

| Credit quality classification |                                   |                               |                                  |                                            |                       |                                    |
|                               | Sovereign debtsecuritiesand bills | Other debtsecuritiesand bills | Wholesale lendingand derivatives |                                            | Retail lending        |                                    |
|                               | External creditrating             | External creditrating         | Internal creditrating1           | 12-month regulatoryprobability ofdefault % | Internal creditrating | 12 month probability-weightedPD %2 |
| Quality classification        |                                   |                               |                                  |                                            |                       |                                    |
| Strong                        | BBB and above                     | A- and above                  | CRR 1 to CRR 2                   |                                  0 – 0.169 | Band 1 and 2          |