HSBC reported a significant increase in expected credit losses, raising its provisions to $900 million for the first quarter of 2025, influenced by deteriorating economic outlook stemming from geopolitical tensions and heightened trade tariffs. The bank's profits declined by nearly 25% compared to the previous year's first quarter, coupled with warnings that escalating trade wars could exacerbate global economic risks, affect trade volumes, and lead to inflationary pressures. They modelled scenarios indicating further tariff increases could hurt revenues and elevate bad debt by an additional $500 million.
HSBC has increased its expected credit losses to $900m for Q1 2025, attributing the higher provisions to deteriorating economic outlook due to geopolitical tensions and tariffs.
The US trade war has amplified risks for the global economy, with HSBC noting it could impact economic growth, trade volumes, and inflation.
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