HSBC AGREES SALE OF LATIN AMERICAN BUSINESSES

London, U.K. – 25 January, 2012 – HSBC Bank (Panama) S.A., an indirect, wholly owned subsidiary of HSBC Holdings plc (“HSBC”), has entered into an agreement to sell the whole of its banking operations in Costa Rica, El Salvador and Honduras to Banco Davivienda S.A. (“Davivienda”), a Colombian-listed banking group, for a total consideration of US$801m in cash. The transaction is subject to regulatory and other approvals and is expected to complete in the fourth quarter of 2012.

The sale represents further progress in HSBC's execution of the strategy set out in May 2011. Commenting on the transaction, Antonio Losada, CEO-designate of HSBC Latin America, said: “We are pleased to have reached this agreement. The transaction demonstrates our commitment to driving growth and improving returns in Latin America by divesting of businesses that do not meet our investment criteria. I would like to thank the management teams and employees for their dedication and wish them every success for the future.”

HSBC is pleased to be working with Davivienda, Colombia’s third-largest bank, on this transaction, given its strong commitment to building a presence in Central America and to maintaining relationships with HSBC’s staff and customers.

As at 30 September 2011, the businesses consisted of 136 branches across the three countries and held approximately US$4.3bn of assets and US$2.5bn in loans.