Hongkong and Shanghai Banking Corp. Ltd. (The) And HSBC Bank (China) Co. Ltd.

HBAP is likely to remain the main revenue and profit contributor to the group. We anticipate HBAP will maintain its position as the largest bank in Hong Kong, established franchises across Asia-Pacific, and access to the global network of the HSBC group. We expect incremental credit losses from Hong Kong and China CRE exposures to be manageable for HBAP. About 60% of its Hong Kong CRE loans is secured and has recourse. We estimate the average loan-to-value (LTV) ratio of the secured book to be healthy at 45%-50% as of end-June 2024. Ongoing revaluations could lead to some increase in the LTV ratio amid subdued property market conditions in the past year. This is noting that valuations of Hong Kong

...The Hongkong and Shanghai Banking Corp. Ltd. (HBAP) will remain the long-term growth engine of the HSBC group. HBAP is pivotal to the group's growth, in our view, given the increasing number of affluent clients and trade flow in Asia-Pacific. The group allocates a growing share of capital to the region through organic growth supplemented by bolt-on acquisitions. HBAP is likely to remain the main revenue and profit contributor to the group. We anticipate HBAP will maintain its position as the largest bank in Hong Kong, established franchises across Asia-Pacific, and access to the global network of the HSBC group....

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