HSBC pretax profit falls 7% in 2025 as bank takes 'decisive action'

HSBC Holdings PLC on Wednesday reported a decline in annual profit, with performance weighed down by rising costs and an impairment charge as management manoeuvres to simplify the business.

The Asia-focused, London-based universal bank, said pretax profit fell 7.4% to $29.91 billion in full-year 2025 from $32.31 billion in the previous year, with diluted earnings per share down 3.2% at $1.20 from $1.24.

The bank lifted its final dividend by 25% to $0.45 per share from $0.36, although the total dividend for the year declined 14% to $0.75 per share from $0.87 per share.

Revenue grew 3.7% to $68.27 billion from $65.85 billion.

Net interest income rose 6.3% to $34.79 billion from $32.73 billion, while net fee income increased 8.5% to $13.34 billion from $12.30 billion.

Chief Executive Officer Georges Elhedery said: ‘2025 was a year of decisive action and swift execution, which is reflected in our strong performance. Each of our four businesses performed well and we have strong momentum across the bank.

‘We are becoming a simple, more agile, focused bank, one that moves with the speed our customers need to navigate the modern world. We are delivering growth, investing for growth and we are executing our strategy with discipline and precision.’

Total operating expenses increased 10% to $36.43 billion in 2025 from $33.04 billion a year earlier, with general and administrative expenses 14% higher at $11.96 billion from $10.50 billion.

HSBC also reported a $1.00 billion impairment relating to its associate Bank of Communications.

Furthermore, the net interest margin improved to 1.59% from 1.56%, and HSBC’s common equity tier one ratio held steady at 14.9%.

Total shareholders’ equity grew 7.2% to $198.23 billion from $184.97 billion, with return on tangible equity falling to 13.3% from 14.6%.

‘We are raising our ambition and targeting a 17% RoTE or better, excluding notable items, in each year from 2026 to 2028. We are also targeting year-on-year revenue growth over the same period on the same basis, rising to 5% in 2028,’ CEO Elhedery explained.

HSBC shares closed 0.3% lower at 1,288.80 pence each in London on Tuesday.

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