Regulatory News:
On 18 February 2025, HSBC Continental Europe’s Board of
Directors reviewed the second half year results and approved the
consolidated financial statements for 2024.
At HSBC, our ambition is to be the preferred and most trusted
international financial partner for our clients. In Continental
Europe, we are focused on serving corporate and institutional
clients, with a particular focus on connecting them to
international markets, financing and facilitating trade within
Europe and between Europe and the rest of the world. We also serve
international high and ultra-high net worth clients of the HSBC
Group through our private banking business in Luxembourg.
In the second half of 2024, we accelerated our strategy by
signing an agreement to sell our private banking business in
Germany and a Memorandum of Understanding for the potential sale of
our life insurance business in France1.
Our results in 2024 reflected growth in wholesale transaction
banking and financing, offset by the impact of lower interest rates
and our ongoing business transformation.
2024 annual results
Profit before tax2 was €930m in 2024.
Net operating income before change in expected credit losses
and other credit impairment charges2 was €3,349m, down from
€3,720m in 2023, driven by lower net interest income following the
sale of the retail banking operations in France. Commercial Banking
revenues were down compared to last year, driven by lower margins
on customer deposits in Global Payment Solutions, while Global
Banking revenues were higher due to growth in Investment Banking.
Revenues in Markets and Securities Services were stable, with
growth in Equities and Securities Financing offset by lower client
activity in Global Debt Markets.
Change in expected credit losses and other credit impairment
charges2 was a charge of €97m, compared with a charge of €145m
in 2023. The cost of risk3 fell to 19bps, with the decrease
compared to last year driven by lower stage 3 provisions,
particularly in Global Banking.
Operating expenses2 were €2,322m, up from €2,250m in
2023, driven by the full-year consolidation of the financial
results of HSBC Private Bank (Luxembourg) S.A. and higher
infrastructure and technology costs. The increase was partly offset
by the end of the build-up of the Single Resolution Fund.
Profit after tax for the period was €603m in 2024, down
from €908m in 2023, and included the write-down of French deferred
tax assets for €150m.
The consolidated balance sheet of HSBC Continental Europe
showed total assets of €265bn at 31 December 2024, compared to
€283bn at 31 December 2023, following the sale of the retail
banking operations in France on 1 January 2024.
At 31 December 2024, HSBC Continental Europe reported an average
liquidity coverage ratio (LCR)4 of 150% and a net stable funding
ratio (NSFR)5 of 137%. The bank’s fully loaded common equity tier 1
(CET1) ratio was 18.8% and the total capital ratio was 23.5%. The
fully loaded leverage ratio was 5.4%. The solvency ratio of the
life insurance subsidiary in France was 286%6.
2024 second half results
Profit before tax2 was €487m, down from €645m in the
second half of 2023.
Net operating income before change in expected credit losses
and other credit impairment charges2 was €1,750m, down from
€1,881m in the second half of 2023, driven by lower net interest
income.
Change in expected credit losses and other credit impairment
charges2 was a charge of €79m, compared with a charge of €125m
in the second half of 2023.
Operating expenses2 were €1,184m, up from €1,111m in the
second half of 2023. The increase was driven by higher
infrastructure and technology costs, and the full-year
consolidation of the financial results of HSBC Private Bank
(Luxembourg) S.A.
2024 results2 per business line7
Commercial Banking
Profit before tax was €585m, down from €762m in 2023, mainly due
to reductions in net interest income on deposits, higher credit
risk provisions and higher infrastructure costs.
At 31 December 2024, customer loan balances of €24.9bn were
stable compared to prior year and customer deposits of €45.7bn were
up €6.3bn.
Commercial Banking in HSBC Continental Europe is a key partner
for companies seeking to set up abroad by connecting them to its
global network of relationship managers and product specialists,
and for foreign companies seeking to expand in the European
Union.
Global Banking
Profit before tax was €360m, up from €321m in 2023, driven by
higher revenues in Investment Banking and lower credit risk
provisions partly offset by lower net interest income.
At 31 December 2024, customer loan balances of €13.6bn were up
€0.6bn compared to prior year and customer deposits of €23.2bn were
down €1.3bn.
Global Banking in HSBC Continental Europe delivers tailored
financial solutions to major government, corporate and
institutional clients, opening up opportunities by leveraging the
strength of the HSBC Group’s expertise and global network.
Markets and Securities Services
Profit before tax was €87m, up from €74m in 2023, with stable
revenues and lower operating expenses following the end of the
build-up of the Single Resolution Fund.
Customer deposits of €16.2bn at 31 December 2024 were down
€1.2bn.
Markets and Securities Services in HSBC Continental Europe plays
a key role as the HSBC Group's strategic platform for
euro-denominated rates products, in particular as a primary dealer
in all European debt issuances and offering equities products for
European stocks.
Global Banking and Markets Other
Global Banking and Markets Other comprises activities that are
outside of the perimeter of Markets and Securities Services and
Global Banking. The main activity is Principal Investments which
brings together HSBC Continental Europe’s core principal investing
activities. The loss before tax was €30m, compared to a profit of
€9m in 2023.
Wealth and Personal Banking
Profit before tax was €63m, down from €185m in 2023, driven by
lower net interest income following the sale of retail banking
operations in France.
Customer loan balances of €4.3bn at 31 December 2024 were down
compared to €11.6bn in 2023, driven by the transfer to Corporate
Centre of the home loan portfolio retained as per the terms of the
sale of the retail banking operations in France.
Customer deposits of €7.1bn at 31 December 2024 were down from
€9.5bn in 2023, as balances related to the private banking business
in Germany were classified as held for sale8.
HSBC Continental Europe offers asset management services through
subsidiaries in France, Germany and Malta, as well as a range of
insurance products through its subsidiaries in France and Malta. It
also serves private banking clients across Continental Europe, and
retail banking clients in Malta.
Corporate Centre
The Corporate Centre comprises operating income and expense
items that are not allocated to the global businesses, as well as
the retained home loan portfolio. The loss before tax was €135m,
compared to a loss of €26m in 2023.
Appendix
The audit procedures relating to the accounts are ongoing.
Summary consolidated income statement
Half year to
Year
€m
31 Dec 2024
31 Dec 20239
2024
20239
Continuing operations
Net interest income
667
1,147
1,498
2,191
Net fee income
613
563
1,214
1,194
Net income/(expense) from financial
instruments held for trading or managed on a fair value basis
423
122
484
259
Other operating income/(expense)
47
49
153
76
Net operating income before change in
expected credit losses and other credit impairment charges
1,750
1,881
3,349
3,720
Change in expected credit losses and other
credit impairment charges
(79)
(125)
(97)
(145)
Total operating expenses
(1,184)
(1,111)
(2,322)
(2,250)
Profit/(loss) before tax
487
645
930
1,325
Tax expense
(289)
(176)
(406)
(346)
Profit/(loss) after tax in respect of
continuing operations
198
469
524
979
Profit/(loss) after tax in respect of
discontinued operations
34
(1,505)
79
(71)
Profit/(loss) after tax for the
period
232
(1,036)
603
908
Profit/(loss) attributable to
shareholders of the parent company
217
(1,050)
568
883
Profit/(loss) attributable to
non-controlling interests
15
14
35
25
Profit/(loss) for the period by global business
Continuing Operations
Wealth and Personal
Banking
Commercial Banking
Markets and Securities
Services
Global Banking
Global Banking and Markets
Other
Corporate Centre
Total
€m
Year 2024
Net operating income before change in
expected credit losses and other credit impairment charges
445
1,363
801
774
31
(65)
3,349
o/w net interest
income/(expense)
175
946
225
412
(12)
(248)
1,498
Change in expected credit losses and
other credit impairment charges
7
(113)
—
14
—
(5)
(97)
Total operating expenses
(389)
(665)
(714)
(428)
(61)
(65)
(2,322)
Profit/(loss) before tax
63
585
87
360
(30)
(135)
930
Year 20239
Net operating income before change in
expected credit losses and other credit impairment charges
615
1,444
803
764
33
61
3,720
o/w net interest income/(expense)
383
1,049
183
453
19
104
2,191
Change in expected credit losses and other
credit impairment charges
5
(88)
1
(63)
(1)
1
(145)
Total operating expenses
(435)
(594)
(730)
(380)
(23)
(88)
(2,250)
Profit/(loss) before tax
185
762
74
321
9
(26)
1,325
Business disposals
On 23 September 2024, HSBC Continental Europe reached an
agreement to sell its private banking business in Germany to BNP
Paribas. The planned sale, which remains subject to governmental
approvals and works council consultation, is expected to be
completed in the second half of 2025.
On 20 December 2024, HSBC Continental Europe signed a Memorandum
of Understanding regarding the potential sale of its life insurance
business in France, HSBC Assurances Vie (France), to Matmut Société
d’Assurance Mutuelle. The completion of the transaction, which
remains subject to consultation processes with respective works
councils and regulatory and competition approvals, is expected to
take place in the second half of 2025.
Accounting policy for classifying non-current assets or
disposal groups as ‘held for sale’
HSBC Continental Europe classifies non-current assets or
disposal groups (including assets and liabilities) as held for sale
when their carrying amounts will be recovered principally through
sale rather than through continuing use. To be classified as held
for sale, the asset or disposal group must be available for
immediate sale in its present condition subject only to terms that
are usual and customary for sales of such assets or disposal
groups, and the sale must be highly probable.
At 31 December 2024, HSBC Continental Europe judged that the
sale of its private banking business in Germany and the sale of its
life insurance business in France were highly probable to complete
in the second half of 2025. As such, and in accordance with IFRS 5,
the disposal groups that included €25.5bn of assets and €24.7bn of
liabilities were classified as held for sale and re-measured at the
lower of the carrying amount and fair value less costs to sell.
The life insurance business in France also met the criteria of
discontinued operations classification and presentation under IFRS
5, and accordingly, the profit/(loss) of the discontinued
operations has been reported separately in the income
statement.
Upon being classified as held for sale in 2023, retail banking
operations in France (sold on 1 January 2024) were judged to have
met the criteria of discontinued operations classification and
presentation under IFRS 5 for the 2023 comparatives.
HSBC Continental Europe
Headquartered in Paris, HSBC Continental Europe is an indirectly
held subsidiary of HSBC Holdings plc. HSBC Continental Europe
principally comprises, in addition to its banking, insurance and
asset management activities based in France, the business
activities of 10 European branches (in Belgium, Czech Republic,
Germany, Ireland, Italy, Luxembourg, Netherlands, Poland, Spain and
Sweden) and two banking subsidiaries in Continental Europe (in
Luxembourg and Malta). HSBC Continental Europe’s mission is to
serve both customers in Continental Europe for their needs
worldwide and customers in other Group countries for their needs in
Continental Europe.
HSBC Holdings plc
HSBC Holdings plc, the parent company of the HSBC Group, is
headquartered in London. HSBC serves customers worldwide from
offices in 58 countries and territories. With assets of US$3,017bn
at 31 December 2024, HSBC is one of the world’s largest banking and
financial services organisations.
1 See appendix for details on business disposals 2 In respect of
continuing operations in accordance with IFRS 5 (see appendix) 3
Change in expected credit losses and other credit impairment
charges divided by customer loans outstanding at the end of the
period. 4 Computed in respect of the EU Delegated act 5 Computed in
respect of CRR II (Regulation EU 2019/876) 6 LCR, NSFR and the
solvency ratio of the life insurance subsidiary are unaudited 7 In
2024, HSBC Continental Europe served its customers through the
following business lines: ‘Commercial Banking’, ‘Global Banking’,
‘Markets and Securities Services’ and ‘Wealth and Personal
Banking’. The 2024 results per business line are presented on this
basis. Following the announcement by the HSBC Group of a new
organisational structure in October 2024, and effective 1 January
2025, HSBC Continental Europe will operate through two new business
lines: ‘Corporate and Institutional Banking’ covering the clients
and products previously served by Commercial Banking, Global
Banking, Markets and Securities Services, and ‘International Wealth
and Premier Banking’ replacing Wealth and Personal Banking. 8 See
appendix 9 In compliance with IFRS 5 standards, the comparatives
have been represented to reflect discontinued operations related to
the planned sale of the life insurance business in France. This
also includes discontinued operations related the sale of the
retail banking operations in France.
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version on businesswire.com: https://www.businesswire.com/news/home/20250219980634/en/
Sophie Ricord sophie.ricord@hsbc.fr +33 (0) 6 89 10 17 62
Raphaële-Marie Hirsch raphaele.marie.hirsch@hsbc.fr +33 (0) 7 64
57 35 55
