HSBC has taken a $1.3bn (£961m) hit to profits, fuelled by the fallout from the US-Israel war on Iran and fraud in the troubled private credit sector .

The London-headquartered bank said profits fell 4% in the first three months of the year, dropping $100m to $9.4bn, compared with the same period in 2025. Revenue increased 6% to $18.6bn.

The profit decline was linked to a jump in the potential losses it could see on soured loans to $1.3bn, which included $300m specifically linked to the impact of the conflict in the Middle East.

HSBC also reported a $400m “fraud-related, secondary, securitisation exposure” in the UK, related to its investment banking division.…