Company: HBCYF
Filing Date: 2025-07-30
Form Type: 6-K
Source: 0001089113-25-000052
Chunk: 93

Company: HSBC HOLDINGS PLC
Filing Date: 2025-07-30
Form: 6-K
Chunk 93
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 No impairment (or reversal) was required for the year

ended 31 December 2024.

If the Group did not have significant influence in BoCom, the investment would be carried at fair value rather than the current carrying amount.

| HSBC Holdings plc Interim Report 2025 on Form 6-K |
| 94                                                |

| Overview |     | Interim management report |     | Interim condensed consolidatedfinancial statements |     | Additional information |

Impairment testing At 30 June 2025, the Group concluded that there were indications of impairment. As part of this assessment, the Group performed an impairment test on the carrying amount with an updated VIU calculation, which resulted in an impairment of $ 1.0b n, as the recoverable amount as determined by the VIU calculation was lower than the carrying amount. The impairment was recognised within ‘Impairment of interest in associate’. The carrying amount of the investment after impairment was $ 21.3b n (31 December 2024: $ 22.4b n) with a fair value of $ 13.1b n (31 December 2024: $ 11.6b n). The impairment loss is not deductible for tax purposes. Basis of recoverable amount The VIU calculation uses discounted cash flow projections based on management’s best estimates of future earnings available to ordinary shareholders prepared in accordance with IAS 36 ’Impairment of Assets’. Those cash flows used estimates based on BoCom’s current condition and so do not include estimated cash flows arising from uncommitted future actions that may affect the performance of the investment, which will be considered at the relevant time should they arise. Significant management judgement is required in arriving at the best estimate. The VIU may increase or decrease depending on the effect of changes to model inputs. The main model inputs are described below and are based on factors observed at period-end. The factors that could result in increases or reductions in the VIU include changes in BoCom’s short- term performance, a change in regulatory capital requirements or revisions to the forecast of BoCom’s future profitability. There are two main components to the VIU calculation. The first component is management’s best estimate of BoCom’s earnings. Forecast earnings growth over the short to medium term continues to be lower than recent (within the last five years ) actual growth, and reflects the impact of recent macroeconomic, policy and industry factors in mainland China. As a result of management’s intent to continue to retain its investment for the