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HSBC reported 2025 earnings that beat market expectations, pushing its market value beyond $270 billion for the first time. Bloomberg shared the update as Europe’s largest bank capped a year of strong share gains and strategic changes.
The bank’s London-listed stock surged 50% in 2025 and climbed another 10% year to date, lifting its valuation to about $300 billion.
Chief Executive Georges Elhedery said the bank acted decisively last year. He stated that HSBC is becoming simpler, more agile, and more focused for a fast-changing world. The bank raised its return on tangible equity target to 17% or better through 2028, up from a mid-teens goal set earlier.
Last year, return on tangible equity stood at 13.3%. Hong Kong-listed shares rose 2.5% after the results. Meanwhile, the bank announced a final dividend of 45 cents per share, adding to 30 cents paid earlier in the year.
Elhedery, a career HSBC veteran, took the helm one and a half years ago. Since then, he reorganized operating divisions along East-West lines and cut senior management ranks. He also exited sub-scale investment banking units in the United States and Europe.
In total, HSBC initiated 11 business exits worldwide last year. The bank logged $1.4 billion in legal provisions and recorded $1 billion in restructuring and related costs. At the same time, pretax profit in mainland China fell 66% to $1.1 billion.
HSBC also took Hang Seng Bank private in a $13.7 billion deal. The bank said combined operations aim to deliver $900 million in pretax revenue and cost synergies by 2028. However, it expects about $600 million in restructuring costs tied to that plan.
Elhedery received 6.6 million pounds in total remuneration in 2025, an 18% increase from the previous year. The bank’s dividend payout of 75 cents for 2025 remained below the 87 cents distributed in total for 2024.
HSBC raised its profitability guidance as net interest margin expansion drove stronger returns in 2025. Higher-for-longer global rates supported that margin growth. This rate environment formed the main engine behind improved performance.
Yet questions remain about how durable that support will be if central banks begin to cut rates. Can HSBC sustain its expanded net interest margin once the rate cycle shifts?
In addition, investment banking revenue jumped in the fourth quarter due to a surge in geopolitical-driven mergers and acquisitions. Global M&A activity rebounded from earlier lows, lifting headline results. Analysts noted that this revenue stream remains volatile and may not persist at elevated levels.
Analysts at Jefferies said investors will likely welcome the earnings beat. Still, they flagged concern over the bank’s forecast of just a 1% cost rise in 2026. Competitive pressures and the need to invest in artificial intelligence technology could challenge that projection.
As a result, HSBC’s raised guidance sets a higher benchmark. The bank’s next phase now depends on sustaining margins, managing costs, and navigating shifting market conditions.
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HSBC closed 2025 with earnings above expectations and a record market value of over $270 billion. The bank raised its profitability target, advanced major restructuring steps, and extended strong share gains. Investors will now watch whether HSBC can sustain margin growth and keep costs under control.
