On 8 December 2023, we affirmed The Hongkong and Shanghai Banking Corp. Ltd 's (HBAP) Aa3 deposit rating with a stable outlook. At the same time, we affirmed the bank's Aa3 long-term senior unsecured rating and issuer rating but changed their outlook to negative from stable.

HBAP's Aa3 long-term deposit rating incorporates its a2 Baseline Credit Assessment (BCA) and Adjusted BCA, and two notches of uplift from our Advanced Loss Given Failure (LGF) analysis.

The a2 BCA takes into account the bank's well-established franchises across Hong Kong SAR, China (Aa3 negative) and the rest of the Asia-Pacific region, good granularity of asset portfolio, strong capitalization, improved profitability, solid deposit base and adequate liquidity.

As a wholly owned subsidiary of HSBC Holdings plc (A3 stable, a3¹), the bank is closely integrated with its parent.