Company: HBCYF
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001089113-25-000040
Chunk: 70

Company: HSBC HOLDINGS PLC
Filing Date: 2025-02-20
Form: 20-F
Chunk 70
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 risk profile. Public spending as a proportion of GDP is likely to remain high for most key economies. Against the backdrop of higher global interest rates, a high level of public debt issuance, and a strong US dollar, borrowing costs for certain countries could increase further. This could adversely impact the fiscal capacity and debt sustainability of highly-indebted sovereign issuers. Additional sanctions on Iran were imposed in 2024 in response to Iran’s activities and the increase in tensions between Israel and Iran. The sanctions and trade restrictions imposed by the US, the UK, and the EU, as well as other countries, as a result of the Russia- Ukraine war, remain complex, far-reaching and evolving. The US has expanded the reach of its secondary sanctions regime, which includes broad discretion to impose severe sanctions on non-US banks. The imposition of such sanctions against any non-US HSBC entity could result in significant adverse commercial, operational and reputational consequences for HSBC. In response to such sanctions and trade restrictions, as well as asset flight, Russia has implemented certain countermeasures, including the expropriation of certain foreign assets. Strategic competition with China has the potential to impact global supply chains which may in turn impact the Group’s operations . The US, the UK, the EU and other countries have imposed various sanctions and trade restrictions on Chinese individuals and companies. China has also imposed its own sanctions, trade restrictions and other measures against certain countries, businesses and individuals. This has resulted in efforts to de-risk certain sectors with the reshoring of manufacturing activities. Further sanctions or counter-sanctions may adversely affect the Group, its customers and various markets. Political changes may also have implications for policy and regulations. Newly elected governments in several key markets have committed to a shift in domestic and foreign policy priorities. The US administration supports sweeping economic, foreign and trade policy changes that, if enacted, are expected to have geopolitical and macroeconomic implications, including an uncertain impact on growth and inflation. HSBC continues to monitor these policy changes and assess their implications for economic conditions in our key markets. Challenging conditions persist in the real estate sector in several of our major markets. The Hong Kong commercial real estate market has seen prices fall amid low transaction volumes and a high interest rate environment. Despite an improvement in sentiment associated with supportive policy measures and recent US interest rate cuts, commercial real estate market demand has remained weak. Prices also fell in the Hong Kong residential market during 2024 but sentiment and transaction volumes started to improve in the fourth quarter, supported by more favourable government measures and improved