HSBC Plans $1 Billion Cash Tender for Perpetual Securities

HSBC Holdings said in a November 5, 2026 announcement that it expects to launch a cash tender offer for up to $1 billion aggregate principal amount of its U.S. dollar-denominated 6.000% perpetual subordinated contingent convertible securities. The offer is intended to proactively manage the bank’s Tier 1 capital base.

The targeted series has $3 billion outstanding, making the tender cap one-third of that principal, calculated as the stated maximum divided by the outstanding amount. The securities are callable on May 22, 2027, and every five years thereafter. The announcement describes an anticipated launch, expected at or before 10:00 a.m. New York City time on November 5, rather than confirming that the offer had already begun.

Accepted securities would receive $1,005 per $1,000 of principal, plus accrued and unpaid interest from the last interest payment date through, but excluding, the settlement date. That additional payment excludes interest cancelled or deemed cancelled under the securities’ terms. Interest will cease to accrue on accepted securities at settlement.

New Issuance Is a Completion Condition

HSBC expects to finance the tender with cash on hand and to launch a proposed issuance of one series of new perpetual subordinated contingent convertible securities on the date of the Offer to Purchase. The new securities would not be subject to the tender, and there is no assurance that their issuance will be completed.

Completion of the tender is nevertheless conditioned on the successful closing of that issuance, on terms reasonably satisfactory to HSBC, at or before the offer’s expiration. HSBC may raise or lower the maximum tender amount, including after pricing the new securities, but is under no obligation to do so. The cash-on-hand funding plan therefore does not remove the issuance condition: completion of the repurchase remains tied to a separate capital-securities transaction.

Deadlines and Allocation Terms

The offer is scheduled to expire at 5:00 p.m. New York City time on November 19, 2026, unless extended or earlier terminated. Holders may validly withdraw tenders through the expiration time, but not afterward unless the withdrawal date is extended. Settlement is expected on November 24, 2026, subject to the maximum tender amount and satisfaction or waiver of the offer conditions by expiration.

If validly tendered and unwithdrawn securities exceed the cap, purchases may be prorated. HSBC will not definitively know whether the maximum has been reached or the effects of proration until after expiration. There is no minimum participation condition.

The minimum tender is $200,000 of principal, with $1,000 increments above that level; partial tenders must leave at least that same minimum in the holder’s remaining position. If proration would return less than the minimum to a holder, HSBC may accept all of that holder’s valid tenders without proration or reject all of them.

All securities accepted in the offer will be cancelled and retired and will no longer be outstanding HSBC obligations. If the offer is terminated, tendered securities will be returned promptly. The central unresolved points are whether the proposed issuance closes on acceptable terms and, once the deadline passes, how much of the existing series HSBC accepts for cancellation.