Company: HBCYF
Filing Date: 2025-06-02
Form Type: 424B5
Source: 0001193125-25-132352
Chunk: 46

Company: HSBC HOLDINGS PLC
Filing Date: 2025-06-02
Form: 424B5
Chunk 46
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 to, wider developments in financial regulation and markets.

Under PRA Supervisory Statement SS16/16 (“SS16/16”), if a UK firm does not have, or expects that it will not have, sufficient CET1,
in addition to any own funds and liabilities counted towards its MREL, to meet the amount of CET1 it should maintain for the purposes of risk-weighted capital and leverage buffer requirements, it will be considered to have used, or be about to use,
the buffers of the regime where the total amount of capital required to meet minimum requirements plus buffers (risk-weighted capital or leverage) is largest. The firm may have to notify the PRA as soon as practicable explaining why this has
happened or is expected to happen. HSBC Holdings is aware that it can expect enhanced supervisory action and may need to prepare a capital restoration plan in such circumstances. If the PRA is not satisfied with the capital restoration plan, or with
HSBC Holdings’ reasons for the shortfall, it will consider using its powers under sections 192C and 192T of the FSMA to require HSBC Holdings to take steps to strengthen its capital position (such steps could include restricting or prohibiting
distributions where that is appropriate and proportionate). Likewise, if HSBC Holdings does not have sufficient CET1 to meet its minimum risk-weighted capital requirements and the combined buffer, automatic restrictions on distributions will apply
under the PRA Rulebook and sections 192C and 192T of the FSMA. As a result,

S-29

MREL/TLAC requirements may result in the reduction of discretionary payments (in whole or in part), including the cancellation (in whole or in part) of interest payments in respect of the
Securities.

The HSBC Group’s capital requirements, including the Pillar 2A requirements, by their nature, are calculated by
reference to a number of factors, any one or a combination of which may not be easily observable or capable of calculation by you. Moreover, the interaction of restrictions on distributions (including interest payments on the Securities) with, and
impact of, the capital requirements and buffers and leverage framework applicable to the HSBC Group, as well as the implementation of MREL/TLAC requirements, remain uncertain in many respects. Such uncertainty is expected to continue while the UK
authorities develop, through the provision of guidance or otherwise, the current rules and consult on and finalize proposals for future rules to be adopted, including the implementation of Basel 3