Company: HBCYF
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001089113-25-000040
Chunk: 17

Company: HSBC HOLDINGS PLC
Filing Date: 2025-02-20
Form: 20-F
Chunk 17
---
 by $3.1bn , reflecting the impact of business disposals and higher funding costs associated with the redeployment of our commercial surplus to the trading book, where the related revenue is recognised in ‘net income from financial instruments held for trading or managed on a fair value basis‘, partly offset by higher NII in HSBC UK, reflecting the benefit of our structural hedge. Banking NII of $43.7bn fell by $0.4bn or 1% compared with 2023, as increased deployment of our commercial surplus to the trading book only partly mitigated the reductions in NII. – Net interest margin (‘NIM’) of 1.56% decreased by 10 basis points (‘bps’), mainly due to increased deployment of our commercial surplus to the trading book. – Expected credit losses and other credit impairment charges (‘ECL’) of $3.4bn were stable. ECL were $1.8bn in Commercial Banking (‘CMB’) and $0.2bn in GBM. This included stage 3 charges relating to the commercial real estate sector in mainland China ($0.4bn), the onshore Hong Kong real estate sector ($0.1bn), and a charge related to a single CMB customer in the UK. ECL in WPB were $1.3bn and primarily related to our legal entities in Mexico, Hong Kong and the UK. ECL were 36 bps of average gross loans, including loans and advances classified as held for sale (2023: 32 bps). – Operating expenses grew by $1.0bn or 3% to $33.0bn , mainly due to higher spend and investment in technology and the impacts of inflation, partly offset by reductions related to our business disposals in Canada and – France, and from lower levies in the UK and the US. – Target basis operating expenses rose by 5% , in line with our cost growth target. This increase primarily reflected higher spend and investment in technology, and the impact of inflation. This is measured on a constant currency basis, excluding notable items, the impact of retranslating the prior year results of hyperinflationary economies at constant currency, and the direct costs from the sales of our French retail banking operations and our banking business in Canada. – Customer lending balances fell by $8bn on a reported basis but rose by $14bn on a constant currency basis. Growth included lending balance growth in CMB and higher mortgage balances in WP