Hang Seng Bank’s profits down 30% to HK$6.88b in H1 2025

Fees and other income rose 34% during the period.

Hang Seng Bank’s profit attributable to shareholders fell 30% to $876.45m (HK$6.88b) in the first six months of 2025.

Operating profit is down 25% to $1.09b (HK$8.55b), and earnings per share is 34% lower at HK$3.34 per share compared to a year earlier.

In contrast, fees and other income rose 34% during the period, which Hang Seng Bank attributed to its diversification strategy. Fee and other income now contributes to 31.6% of the bank’s total revenue, compared to 25.9% in end-2024.

Profit before tax was impacted by an increase in provisions as the bank adopted a “prudent and proactive approach to managing risks,” said chief executive and executive director Diana Cesar.

Cesar called the first half of the year as “demanding”, citing ongoing uncertainties due to trade tariffs, sustained high interest rates, and prolonged downturn in the commercial property market.

As a result, Hang Seng Bank has increased its provision and expected credit losses (ECL) to $624.21m (HK$4.9b). This led to its profit before tax declining 28% to $1.03b (HK$8.1b).

Hang Seng Bank has declared a second interim dividend of HK$1.3 per share, for a total of HK$2.6 per share in H1 2025.

The bank also intends to initiate a share buy-back of up to $382.16m (HK$3b), and expects to complete this during a six-month period.

Common equity tier 1 (CET1) capital ratio is 21.3% as of end-June 2025.

Non-performing loans (NPL) reached 6.69% on ongoing credit pressure from the property sector.

Looking ahead, Cesar sees promise in the capital markets and the residential property sector.

“We see early signs of recovery in the capital markets and a gradual improvement in the residential property sector. Whilst there are challenges, we are optimistic about Hong Kong’s long-term growth prospects,” she said.

(US$1 = HK$7.85. As of 31 July 2025, Google, from Morningstar)