Core Viewpoint - HSBC Continental Europe reported strong revenue growth in Corporate and Institutional Banking for the first half of 2025, driven by increased client activity, although this was partially offset by technology investments and restructuring costs [2][4]. Financial Performance - Profit after tax for the first half of 2025 was €373 million, stable compared to €370 million in the same period of 2024 [5]. - Net operating income before expected credit losses and other credit impairment charges was €1,912 million, up from €1,699 million in the first half of 2024, primarily due to higher revenues in Corporate and Institutional Banking [5]. - Profit before tax was €490 million, down from €549 million in the first half of 2024 [7]. Credit Losses and Expenses - The change in expected credit losses and other credit impairment charges was a charge of €70 million, compared to €13 million in the first half of 2024, with a cost of risk of 30 basis points [6]. - Operating expenses increased to €1,352 million from €1,137 million in the first half of 2024, attributed to restructuring costs and technology investments [6]. Balance Sheet and Ratios - Total assets as of June 30, 2025, were €280 billion, up from €265 billion at the end of 2024 [7]. - The average liquidity coverage ratio (LCR) was 144%, and the net stable funding ratio (NSFR) was 145% [8]. - The fully loaded common equity tier 1 (CET1) ratio was 15.5%, and the total capital ratio was 19.8% [8]. Business Strategy and Disposals - HSBC Continental Europe is executing a simplification strategy, focusing on areas with competitive advantages and growth opportunities [4]. - The company has signed agreements to sell its custody and fund administration businesses in Germany and a portfolio of home and certain other loans in France [3][19]. - The sale of its private banking business in Germany and life insurance business in France is expected to complete in the second half of 2025 [13][14].

Core Viewpoint - HSBC Continental Europe has agreed to sell its custody business in Germany to BNP Paribas, aligning with its strategy to focus on corporate and institutional banking for international clients in Europe [2][3]. Group 1: Transaction Details - The sale is part of HSBC's simplification strategy announced in October 2024, aimed at enhancing leadership and market share in areas of competitive advantage [3]. - The custody business in Germany provides domestic custody, clearing, and depository services for German institutional clients, with all staff, assets, and clients transferring to BNP Paribas [4]. - The completion of the transaction is subject to regulatory and anti-trust approvals, as well as negotiations with the Works Council in Germany [4]. Group 2: Transition Plan - A phased transfer of staff and clients is expected to begin in early 2026, with both HSBC and BNP Paribas focused on ensuring a smooth transition [5]. Group 3: Company Background - HSBC Continental Europe operates across various European countries, providing corporate and institutional banking, private banking, insurance, and asset management services [7]. - HSBC Holdings plc, the parent company, is one of the largest banking organizations globally, with assets of approximately USD 3,054 billion as of March 31, 2025 [9]. - BNP Paribas is a leading European banking and financial services provider, operating in 64 countries with a strong presence in corporate and institutional banking [10][11]. Group 4: Securities Services Overview - BNP Paribas' Securities Services business is a global custodian with a custody network covering over 90 markets, managing USD 15.4 trillion in assets under custody as of March 31, 2025 [12].