HSBC Continental Europe revealed it has agreed to sell a portfolio of French home and other retail loans to a consortium made up of Rothesay Life and CCF.
HSBC Continental Europe to Sell French Portfolio of Home and Other Retail Loans
The portfolio, valued at €6.7 billion as of December 31, 2024, was retained following HSBC’s earlier disposal of its wider French retail banking business.
The proposed sale, outlined in a memorandum of understanding, is expected to be completed in the fourth quarter of 2025.
HSBC Continental Europe said it would work closely with the buyers to ensure a smooth transition.
The transaction follows the portfolio’s reclassification on January 1 from “hold-to-collect” to “hold-to-collect-and-sell.”
During the first quarter of 2025, HSBC Group recorded a €1.2 billion pre-tax fair value loss through other comprehensive income, and a €0.1 billion gain in the income statement from related interest rate hedges.
The fair value loss reduced HSBC Group’s CET1 ratio by around 0.2 percentage points.
Upon completion, the loss will be recycled to the income statement without further impact on capital ratios.
The bank explained that risk-weighted assets linked to the loans will be deconsolidated, providing a minor benefit to HSBC Group’s CET1 ratio and an estimated 0.3 percentage point uplift to HSBC Continental Europe’s CET1 ratio.
HSBC said the deal reflects its continued focus on building a leading corporate and institutional banking franchise across Europe.
