Two HSBC bank logos on an office building in Mexico City, Mexico, July 25, 2025.
Henry Romero | Reuters
Shares in Hong Kong-listed Hang Seng Bank closed 25.88% higher on Thursday following parent HSBC’s proposed delisting, valuing the bank at more than HK$290 billion (more than $37 billion).
HSBC, Europe’s largest financial institution, has asked the board of Hang Seng Bank to submit a privatization proposal to its shareholders through a scheme of arrangement under Hong Kong’s Companies Ordinance.
The Hang Seng Bank shares will be canceled in exchange for HK$155 per share, approximately 33% above Hang Seng Bank’s average share price of HK$116.5 per share over the past 30 days. HSBC holds about 63% of Hang Seng Bank in a deal worth HK$106 billion.
HSBC Hong Kong stocks fell 5.52%. The company’s London-listed shares fell more than 5% last time.
HSBC Group CEO Georges Erkederi said: “Our proposal is an exciting opportunity to grow both Hang Seng and HSBC.” “We will continue to invest in new strengths in products, services and technology while maintaining Hansen’s brand, heritage and customer proposition.”
Hang Seng Bank stock price since the beginning of the year
He added that the agreement confirms HSBC’s confidence in Hong Kong’s role as a major global financial center and a “super connector” between international markets and mainland China.
The offer allows for adjustments to reflect dividends declared after the announcement date, with the exception of Hang Seng’s third interim dividend in 2025.
“One of HSBC’s strategic priorities is growth in Hong Kong,” the bank said in a filing, adding that it believes it is “best placed” to do so by strengthening the banking presence of both HSBC Asia Pacific and Hang Seng Bank in Hong Kong.
Hang Seng Bank is the core regional arm of London-based HSBC and has a significant presence in Hong Kong’s banking industry.
“Dual parent-child listings inherently have governance issues, so in that sense this is a positive and long-overdue move,” said Michael McDad, a senior analyst at Morningstar.
Hang Seng Bank has seen an increase in non-performing loans in recent years, linked to its concentration in the troubled real estate sector in Hong Kong and mainland China.
In its first-half 2025 results, the bank said non-performing loans amounted to 6.69% of total customer loans and advances due to “continued credit pressure, primarily in the real estate sector.” This is an increase from 6.12% as of December 31, 2024 and 5.32% as of June 30, 2024.
