HSBC Said To Be Eyeing Private Credit Foray Amid Tariff Turmoil, Waning Retail Trader Interest
)
Synopsis
The bank may not create a separate unit or team to handle private credit, as other banks have done amid concerns about costs, a report suggested.
HSBC (HSBC) stock garnered a bit of retail attention over the weekend after a report said the bank is preparing for an entry into the market for private credit.
Reuters reported, citing a source familiar with the matter, that the lender has held talks with private credit firms about a potential partnership.
The report said the talks are at different stages, and it is not certain that they will lead to a formal partnership.
While some competitors have fully embraced private credit, senior executives at the bank, including CEO Georges Elhedery, reportedly remain skeptical that the revenue will justify the costs.
Therefore, the bank is likely to stop short of a full-blown push into the sector, per the report.
U.S. President Donald Trump’s broad tariffs have impacted short-term credit demand as corporate borrowers reassess the resulting uncertainty. According to the report, HSBC plans to take a more cautious stance.
Last year, U.S. peer Citi partnered with private Apollo Global on a $25 billion private credit and direct lending program.
The report added that HSBC may not create a separate unit or team to handle private credit, as other banks have done amid concerns about costs.
The bank could instead offer private lending through its asset management and life insurance businesses in Hong Kong.
Retail chatter about the stock has fallen 50% over the past year on Stocktwits.
The bank has looked to trim costs through job cuts and a significant overhaul of its investment banking business, which included pullback of operations from the U.S., the UK, and continental Europe.
HSBC’s U.S.-listed shares have risen 24.8% over the past year.
For updates and corrections, email newsroom[at]stocktwits[dot]com.<
)
)