Bankers at HSBC are set to divide a $3.9bn bonus pot, marking the highest payout for the lender in over a decade. The substantial reward follows a fiscal year that exceeded analyst expectations, despite a 7% dip in overall pre-tax profits to $29.9bn. Leadership attributed the 10% year-on-year increase in the bonus pool to a comprehensive review of both financial and non-financial performance metrics throughout 2025.
The announcement comes as CEO Georges Elhedery nears the completion of a massive strategic overhaul aimed at simplifying the institution. Elhedery, who saw his own pay package rise to £14.4m, noted that the bank is becoming more “agile and focused” in a volatile global market. The lender’s London-listed shares responded positively to the news, jumping 5% during morning trading as investors reacted to the better-than-forecasted results.
The bank’s internal transformation has involved a significant reorganization along “east-west” lines and the divestment of smaller investment units in Europe and the US. These efficiency measures have already yielded results, with the bank on track to meet a $1.5bn cost-saving target six months ahead of schedule. Such aggressive restructuring contributed to a 50% surge in the bank’s stock price over the course of 2025.
Despite the optimistic bonus figures, the bank did face headwinds, including a $2.1bn write-off related to its interests in China’s property sector. Profits in mainland China fell significantly, yet the bank remains committed to its Asian stronghold. Looking forward, HSBC has raised its profitability targets, aiming for a return on tangible equity of 17% or better through the year 2028.
While investors have generally welcomed the results, some analysts expressed caution regarding future cost projections. The bank has forecast a mere 1% rise in operating costs for 2026, a figure some believe is ambitious given the high level of investment required for artificial intelligence. With the recent appointment of Brendan Nelson as chair, the bank appears to have finally stabilized its top-level leadership for the coming years.