The Luxembourg Supreme Court only accepted HSSL’s appeal regarding the cash restitution claim by Herald. HSSL will file a second appeal.

Zhitong Finance APP reported that HSBC Holdings (00005) announced that HSBC Securities Services Luxembourg (HSSL) is defending against a claim for the return of securities and cash made by Herald Fund SPC (Herald) in connection with a lawsuit related to the Bernard L. Madoff Investment Securities LLC fraud case in Luxembourg in 2009. On October 24, 2025, the Luxembourg Supreme Court dismissed HSSL’s appeal regarding Herald’s claim for the return of securities but accepted HSSL’s appeal regarding Herald’s claim for the return of cash. HSSL will now file a second appeal with the Luxembourg Court of Appeal.

If HSSL loses the second appeal, it will contest the amount payable by HSSL in subsequent proceedings before the Court of Appeal.

In light of this, HSBC Holdings Limited will recognize a provision of USD 1.1 billion in its consolidated financial results for the third quarter of 2025, which will have an impact of approximately 15 basis points on the Group’s Common Equity Tier 1 capital ratio. Given that the second appeal is still pending and due to the complexity and uncertainty associated with determining the repayment amount, the final financial impact could differ significantly. This provision will be classified as a material item of note and will not affect the Group’s average tangible equity return for the fiscal year 2025 excluding items of note or any dividend payments.