Zhi Tong Cai Jing·2025-09-25 07:27Core Viewpoint - Hang Seng Bank's stock has seen a significant decline, attributed to HSBC's intervention in managing bad debts related to commercial real estate loans in Hong Kong, with expectations of selling over $3 billion in non-performing loans [1] Group 1: Stock Performance - Hang Seng Bank's shares fell over 3% at the close, currently down 2.79% at HKD 114.9, with a trading volume of HKD 378 million [1] Group 2: Bad Debt Management - HSBC has directly intervened in Hang Seng Bank's bad debt management, sending senior executives to oversee the sale of non-performing loans related to Hong Kong real estate [1] - The expected sale involves over $3 billion in bad loans, with the bank's commercial real estate non-performing loans reaching approximately HKD 25 billion as of June, marking an 85% increase year-on-year [1] Group 3: Credit Ratings and Outlook - Fitch Ratings has downgraded Hang Seng Bank's risk rating from "a" to "a-" due to high concentration in commercial real estate loans and a significant deterioration in credit quality since 2024 [1] - As of mid-2025, these loans are projected to account for 46% of Hang Seng Bank's impaired loans, with expectations of further deterioration in the next one to two years due to declining property valuations [1] - Despite the downgrade, Fitch maintains a stable outlook, indicating that Hang Seng Bank's credit risk management is proactive [1]