【HSBC】HSBC reportedly suspends lending to high-risk private credit clients to reduce risk exposure

Foreign media cited an inside source as saying that HSBC (00005) has paused lending to high-risk private credit customers to reduce risk exposure.

The report said that after HSBC decided to stop issuing loans to private credit funds whose returns are insufficient to offset the risks, it informed some customers in recent weeks that it will no longer renew their loan agreements and will focus on lending to private credit funds with lower risk.

HSBC Adjusts Its Risk Appetite Toward the Private Credit Industry

A source close to HSBC said that HSBC’s interest in private credit remains strong, but it is adjusting its risk tolerance toward the industry. As a result, it will no longer provide loans to some private credit funds, but will continue to offer other services to these funds.

The source added that the exits of Barclays and HSBC have forced private credit funds to seek alternative financing options with conditions similar to their own.

HSBC responded that it will provide services covering all stages of the private credit market and will focus on providing trading support for the world’s most important clients, especially in regions with the greatest growth potential.