HK Stock Market Move | Hong Kong bank stocks continue to decline, uncertainty in Middle East lending exacerbates, Standard Chartered has a higher exposure in the Middle East.

Hong Kong bank stocks continued to decline recently. As of press time, Dah Sing Banking (02356) fell 4.73% to 11.89 Hong Kong dollars; HSBC Holdings (00005) fell 3.68% to 130.8 Hong Kong dollars; Bank of East Asia (00023) fell 3.35% to 13.84 Hong Kong dollars; and Standard Chartered (02888) fell 0.62% to 176.9 Hong Kong dollars. On the news front, tensions in the Middle East continue to escalate, leading to uncertainties in loans for Asian banks in the Gulf region. Data shows that Asian and Chinese banks are the main financial institutions in the Gulf region, with loans exceeding 15 billion US dollars last year, triple the amount from the previous year. Most of the funds flowed to Saudi Arabia and the United Arab Emirates. Morgan Stanley released a research report stating that Standard Chartered may experience a significant pullback, mainly due to its high exposure in the Middle East. Standard Chartered's loans and revenue in the UAE accounted for 2.5% and 5.6% respectively in 2025, while HSBC disclosed that its loans and revenue in the Middle East accounted for 2.3% and 3.8% respectively. Considering that as of the second quarter of 2025, around 73% of Standard Chartered's loans in the UAE were directed towards government, public institutions, or banks, its overall credit risk is believed to be manageable.