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

Company: HSBC HOLDINGS PLC
Filing Date: 2025-04-29
Form: 6-K
Chunk 6
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 retail banking operations on 1 January 2024, HSBC Continental Europe retained a portfolio of home and certain other loans, with a carrying value of €7.1bn ($7.9bn) at the time of sale.

During the fourth quarter of 2024, we began actively marketing the retained portfolio for sale. As a result, on 1 January 2025 we reclassified the portfolio to a hold-to-collect-and-sell business model, measuring it at fair value through other comprehensive income. Since reclassification and during 1Q25, we recognised a fair value pre-tax loss in other comprehensive income of $1.3bn on the remeasurement of the financial instruments, which resulted in an approximately 0.2 percentage point reduction in the Group's CET1 ratio. The valuation of this portfolio of loans may be substantially different in the event of a sale due to entity and deal-specific factors, including funding costs and the value of customer relationships. In the event of a sale, upon completion, the cumulative fair value changes recognised through other comprehensive income, which would reflect the terms of an agreed sale, would reclassify to the income statement. In December 2024, we entered into non-qualifying economic hedges, hedging interest rate risk on the portfolio and recognised a $0.1bn mark-to-market gain in 1Q25 in 'net income from financial instruments held for trading or managed on a fair value basis'.

Other disposals

On 23 September 2024, HSBC Continental Europe, a wholly-owned subsidiary of HSBC Bank plc, reached an agreement to sell its private banking business in Germany to BNP Paribas. The disposal group met the held for sale criteria, with balances classified as held for sale at 31 March 2025 of $2.0bn in assets and $2.0bn in liabilities. This sale is expected to complete in the second half of 2025 and generate an estimated pre-tax gain on disposal of $0.2bn, which will be recognised on completion.

On 25 September 2024, HSBC reached an agreement to transfer its business in South Africa to local lender FirstRand Bank Ltd. The disposal group met the held for sale criteria, with balances classified as held for sale at 31 March 2025 of $0.8bn in assets and $3.1bn in liabilities. The transaction, which is subject to regulatory and governmental approvals, is expected to complete in the second half of 2025