HSBC to set aside US$1.1 billion for potential Madoff fraud payouts

South China Morning PostCenterEN 1 min read 100% complete by Enoch YiuOctober 27, 2025 at 05:07 AM

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HSBC Holdings will set aside US$1.1 billion for potential payouts related to lawsuits stemming from the Bernard Madoff fraud case, as disclosed in a stock exchange filing on Monday. This provision will affect HSBC’s third-quarter earnings and impact its common-equity tier one capital ratio by around 15 basis points. The move follows a Luxembourg court ruling that denied HSBC Securities Services Luxembourg's appeal against claims made by Herald Fund SPC for securities restitution but allowed an appeal on cash-restitution claims. HSBC plans to contest the amount of payment if it fails in its second appeal at the Luxembourg Court of Appeal. This provision will not affect the bank’s full-year rate of return excluding notable items in 2025 or any dividend payouts.

Key Topics & Entities

Europe 35% Hong Kong 40% Luxembourg Court of Appeal 50% Bernard L. Madoff Investment Securities 60% Luxembourg Court of Cassation 70% Herald Fund SPC 80% Bernard Madoff ×290% HSBC Holdings ×4100%

Keywords

hsbc 100% bernard madoff fraud case 90% provision 80% third-quarter earnings 70% herald fund spc lawsuit 70% common-equity tier one capital ratio 60% ponzi scheme 60% securities restitution 50% luxembourg court of cassation 50% cash-restitution claim 40%

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Negative

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South China Morning Post

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Center (0.10)

Far LeftCenterFar Right

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90%

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Hong Kong

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hsbc bernard madoff fraud case provision third-quarter earnings herald fund spc lawsuit common-equity tier one capital ratio ponzi scheme securities restitution luxembourg court of cassation cash-restitution claim

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