Company: HBCYF
Filing Date: 2025-10-28
Form Type: 6-K
Source: 0001654954-25-012267
Chunk: 4

Company: HSBC HOLDINGS PLC
Filing Date: 2025-10-28
Form: 6-K
Chunk 4
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 which mitigated the impact of lower market interest rates. The fall in interest rates reduced the funding costs of the trading book by $1.5bn, which resulted in a fall in banking NII of $0.4bn to $32.4bn .

- NIM of 1.57% was stable compared with 9M24, as improved margins in our main markets were offset by the impact of the disposal of our business in Argentina.

- ECL were $2.9bn, an increase of $0.9bn compared with 9M24. The increase included $0.6bn of higher charges related to the Hong Kong CRE sector, which 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 increase also included a charge against a Middle Eastern exposure in the third quarter. In 9M24, the ECL charge benefited from allowance releases, mainly in the UK, and from a recovery relating to a single CIB client. Annualised ECL charges were 40bps of average gross loans, including loans and advances classified as held for sale.

- Operating expenses increased by $2.7bn or 11% to $27.1bn compared with 9M24. The increase primarily reflected notable items in 9M25, including legal provisions of $1.4bn, restructuring and other related costs associated with our organisational simplification of $0.8bn, and $0.2bn related to strategic transactions. In addition, there was higher planned spend and investment in technology and the impacts of inflation. These increases were partly offset by reductions related to our business disposals in Canada and Argentina, and the benefits of our organisational simplification. Target basis operating expenses rose by $0.7bn or 3% compared with 9M24, primarily due to higher spend and targeted investment in technology and the impacts of inflation.

Outlook

- We expect to deliver a mid-teens or better RoTE for 2025, excluding notable items. This reflects sustained momentum in the earnings of our four businesses into the third quarter and the positive progress we are making in our strategic execution. Our guidance reflects a seasonally lower RoTE in the fourth quarter, which includes historically lower client activity in Wealth and certain cost items specific to the fourth quarter (e.g. the UK bank levy). It also includes a higher