Company: HBCYF
Filing Date: 2025-04-29
Form Type: 6-K
Source: 0001654954-25-004763
Chunk: 19

Company: HSBC HOLDINGS PLC
Filing Date: 2025-04-29
Form: 6-K
Chunk 19
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 with 1Q24, and by $1.7bn or 10% compared with 4Q24, due to the business disposals referred to above and lower market interest rates. Excluding the favourable effects of foreign currency translation differences, interest expense fell by $3.2bn compared with 1Q24, and by $1.5bn compared with 4Q24.

Banking net interest income

Banking NII is an alternative performance measure, and is defined as Group NII after deducting:

- the internal cost to fund trading and fair value net assets for which associated revenue is reported in 'Net income from financial instruments held for trading or managed on a fair value basis', also referred to as 'trading and fair value income'. These funding costs reflect proxy overnight or term interest rates as applied by internal funds transfer pricing;

- the funding costs of foreign exchange swaps in Markets Treasury, where an offsetting income or loss is recorded in trading and fair value income. These instruments are used to manage foreign currency deployment and funding in our entities; and

- third-party NII in our insurance business.

In our segmental disclosures, the funding costs of trading and fair value net assets are predominantly recorded in CIB in 'net income from financial instruments held for trading or managed on a fair value basis'. On consolidation, this funding is eliminated in Corporate Centre, resulting in an increase in the funding costs reported in NII with an equivalent offsetting increase in 'net income from financial instruments held for trading or managed on a fair value basis' in this segment. In the consolidated Group results, the cost to fund these trading and fair value net assets is reported in NII. Third-party NII in our insurance business is deducted from reported NII in IWPB to compute banking NII. Total insurance NII is presented in 'fee and other income' in the Insurance product within Wealth in IWPB's management view of revenue, with intercompany NII presented in 'other'.

Banking NII was $10.6bn in 1Q25, a reduction of $0.7bn or 6% compared with 1Q24. The fall in banking NII included reductions from the disposal of our business in Argentina of $0.5bn and our banking business in Canada of $0.3bn. The funding costs associated with generating trading and fair value income were $2.4bn, a decrease of $0.3bn compared with 1Q24, primarily reflecting a reduction