LONDON, March 16, 2026, 14:10 GMT.
Shares in HSBC Holdings picked up 0.6% to 1,187.4 pence as of 11:23 UTC on Monday. The uptick came despite the bank’s announcement that it was shuttering some UAE branches indefinitely and keeping all but one branch in Qatar closed. The gain recouped just a sliver of last week’s sharp losses.
HSBC has become something of a barometer for traders factoring Middle East risk into European banks. According to JPMorgan, which weighed in last week, HSBC and Standard Chartered carry the heaviest regional exposure among big European lenders. HSBC’s revenue and profit before tax exposure sits at roughly 4%, JPMorgan said, but that figure climbs close to 9% once Egypt, Turkey, and Saudi Arabia are accounted for.
JPMorgan pegs HSBC’s Middle East loan exposure—mostly tied up in the UAE and Qatar—at roughly $23 billion, representing 2% of the bank’s entire loan portfolio. Since the Feb. 28 strikes on Iran, HSBC shares have dropped 14%, outpacing the 11.4% fall in Standard Chartered and the 9.5% decline across the STOXX Europe banks index, according to Reuters.
More disruption on Monday: HSBC announced that several UAE branches will remain closed for now, but its customer service points in malls are still operating. Citigroup, on the other hand, is leaving most of its UAE offices and branches shut for the foreseeable future.
HSBC managed to buck the trend on Monday, outperforming its sector peers. Europe’s banking index slipped 0.6%, the STOXX 600 edged down 0.3%, and the FTSE 100 hardly moved as BP and Shell followed oil prices holding above $100 a barrel.
“Given that the conflict is only two weeks old, policy will be on hold,” said Jeremy Batstone-Carr, European strategist at Raymond James. Investors are watching for updated forecasts and hints from the Fed, ECB and Bank of England. That’s left bank stocks reacting as much to the macro backdrop as to company headlines. Reuters
There’s no clear-cut impact. Morningstar equity analyst Kathy Chan flagged “additional risks” tied to the uncertainty, especially for trade finance and credit costs. On the flip side, Hargreaves Lansdown’s Matt Britzman pointed out that the turmoil might actually boost demand for foreign exchange and cash management. Reuters
HSBC’s been working to keep its messaging focused. On March 9, Chief Executive Georges Elhedery said the bank’s “conviction in the GCC’s fundamentals and its future is unchanged,” describing the Asia-Middle East corridor as “a defining axis of global growth.” Numbers crunched by Reuters from HSBC data put UAE and Saudi operations at roughly 5% of group profits a year across the last five years. Reuters
The stock entered this month’s volatility already moving higher. HSBC on Feb. 25 bumped its return on tangible equity target to at least 17% through 2028, after 2025 pretax profit surpassed forecasts. That added to the sense that Elhedery’s restructuring is largely complete.
The risks are still right there. Oil sticking above $100, tighter airspace and shipping snarls, or any fresh Gulf slowdowns could squeeze HSBC’s trade and corporate lending, even without a spike in credit losses. UBS Global Wealth Management just last week downgraded European banks to “neutral,” warning those gains could slip away fast—even if energy supply bounces back. Reuters
