Key facts
- HSBC recorded a $400 million charge related to external fraud.
- The loss occurred in May and impacted the corporate and institutional banking arm.
- The exposure was indirect, linked to a UK financial sponsor involved in securitisation.
- The sponsor is reportedly connected to the collapsed UK mortgage provider Market Financial Solutions.
HSBC has announced a significant operational risk loss of $400 million, attributed to external fraud. This charge, detailed in the bank's first-quarter results released on May 5, stems from an indirect exposure to a UK financial sponsor involved in securitisation. The sponsor is reportedly linked to Market Financial Solutions, a collapsed UK mortgage provider. The loss primarily affected HSBC's corporate and institutional banking division, marking it as the largest operational risk loss reported in May.