London, March 12, 2026, 13:19 GMT
HSBC Holdings tumbled 5.8% in London on Thursday. The bank’s move to close every branch in Qatar, coupled with more caution from analysts about its Middle East conflict risk, weighed on sentiment. The shares were also ex-dividend.
The selloff hits where it counts: earnings, not just market chatter. J.P. Morgan figures HSBC holds around $23 billion in Middle East loans—that’s about 2% of its total lending. Alongside Standard Chartered, HSBC faces the highest regional exposure among European banks, according to the analysts. Revenue and pretax profit exposure stand near 4% for HSBC, with pretax profit at risk of climbing to almost 9% when factoring in Egypt, Turkey, and Saudi Arabia.
Thursday’s action wasn’t driven solely by geopolitical factors. HSBC noted its stock would go ex-dividend across London, Hong Kong and Bermuda on March 12—so anyone buying now won’t get the next dividend. The bank put that fourth interim payout at $0.45 a share, to be included with its 2025 results.
Gulf banks have been ramping up contingency measures. Standard Chartered started evacuating staff from its Dubai offices, Reuters said Wednesday. HSBC has shut all its branches in Qatar for now. Then on Thursday, Citigroup announced it will close most UAE branches, keeping doors shut through March 14 as a safety move.
Nerves rippled through the broader market, intensifying the selloff. Oil pushed back above $100 a barrel. Traders responded, bumping up the odds of a Bank of England rate hike in December to better than even. “The longer the disruption goes on, the greater the impact on energy prices and in turn global inflation,” said Danni Hewson, head of financial analysis at AJ Bell, to Reuters. Reuters
That doesn’t line up with what HSBC told investors back on Feb. 25. After annual pretax profit hit $29.9 billion—topping forecasts despite some one-off charges dragging on earnings—the bank bumped its return on tangible equity goal to at least 17% through 2028, a step up in profitability targets.
Earlier this week, Chief Executive Georges Elhedery reiterated that HSBC’s “conviction in the GCC’s fundamentals and its future is unchanged,” pointing to the Gulf Cooperation Council economies. Despite heightened safety protocols region-wide, the bank has yet to temper its long-term Gulf outlook in public statements. Reuters
Still, short-term risks remain firmly in the picture. J.P. Morgan flagged that rising energy prices may put the squeeze on corporate borrowers in sectors like agriculture, manufacturing, construction, and transport. The bank, though, sees the more pressing issue for HSBC as earnings pressure rather than an immediate spike in credit losses—much of its lending in the Middle East is to highly rated corporates. Shares of Standard Chartered dropped over 2% on Thursday. If banking operations across Gulf hubs encounter wider disruption, HSBC’s regional growth story could face tougher questions. That’s underscored by recent branch closures and J.P. Morgan’s caution on profit headwinds.
