Notification regarding liquidation of the underlying fund of L14 HSBC Russia Equity

30 Sep 2025

• L14 HSBC Russia Equity 

(the Affected Mirror Fund)

The Affected Mirror Fund directly invests into the HSBC Global Investment Funds - Russia Equity (the “Underlying Fund”), a sub-fund of HSBC Global Investment Funds (“HGIF”). The Underlying Fund has been suspended since 1 March 2022 following Russia’s invasion of Ukraine and the subsequent imposition of international sanctions on Russian companies and individuals. As advised in our notification of 2 March 2022, units in the Affected Mirror Fund were therefore also suspended. 

The board of HGIF (the “Board”) has made the decision to liquidate the Underlying Fund (the “Underlying Fund Liquidation”) in the best interests of investors, given the elapsed time since the Underlying Fund was suspended. The Underlying Fund Liquidation was triggered on 30 July 2025 (the “Underlying Fund Liquidation Date”).

Below is a summary of the liquidation and how it affects in force policies. Please read the relevant Sample Client Communications opposite for full information.

Details of the Underlying Fund Liquidation
The Underlying Fund’s net-assets comprised two portions, being (i) the liquid assets mainly comprised of cash held by the Underlying Fund (the “Underlying Liquid Assets”) and (ii) the Russian securities held by the Underlying Fund (the “Underlying Russian Assets”).

The Underlying Fund Liquidation will initially only involve the disposal of the Underlying Liquid Assets and will not automatically involve the disposal of any of the Underlying Russian Assets, owing to their lack of liquidity as a result of sanctions. This approach aims at ensuring the distribution of Underlying Liquid Assets to investors of the Underlying Fund and preservation of any potential future value of the Underlying Russian Assets.

Once it becomes possible to do so, the investment adviser of the Underlying Fund will sell the Underlying Russian Assets, aiming to act in the best interests of investors. Potential value of the Underlying Russian Assets resulting from any future upturn in circumstances will be preserved, with net liquidation proceeds distributed on an ad-hoc basis once sanctions are lifted and the Russian stock market normalises, on pro-rata portion of investors’ holdings in the Underlying Fund as at the Underlying Fund Liquidation Date.

The Underlying Fund will remain suspended to trading and will not accept redemption and/or switch out requests from the Underlying Fund Liquidation Date. Any previously received requests since 28 February 2022 up to and including the Underlying Fund Liquidation Date have automatically been cancelled.

Distribution of liquidation proceeds from the Underlying Fund to policyholders of the Affected Mirror Fund

Following receipt by FPIL of the distribution of Underlying Liquid Assets (the “Liquidation Proceeds”), we have calculated the amount to be allocated to affected policies (the “Liquidation Proceeds Distribution”), on a pro-rata basis, based on the unit holding in the Affected Mirror Fund as at the Underlying Fund Liquidation Date.

Because the Underlying Fund remains suspended to redemption and switch-out requests, the Affected Mirror Fund also continues to be suspended and zero priced. The Liquidation Proceeds Distribution has therefore been applied to affected in force policies on 14 August 2025, by way of a unit allocation to an alternative investment-linked fund in the FPIL range, free of charge.

The funds we selected to receive the Liquidation Proceeds Distribution (the “Default Mirror Funds”) are

Please refer to the Appendix in the relevant Sample Client Communications opposite for further details of the Default Mirror Funds. 

As disclosed in the Terms and Conditions, FPIL policies may currently hold up to a maximum of 10 funds. Where a policy already holds the maximum permissible 10 funds, the allocation has instead been applied to the mirror fund policy holding with the highest value.

Whilst appropriate due diligence has been carried out on the Default Mirror Funds, we do not accept any liability for the future performance of these, or any other FPIL funds. 

Impact of the Underlying Fund Liquidation on holdings in the Affected Mirror Fund

The notional units held of the Affected Mirror Fund remain unchanged after the Liquidation Proceeds Distribution and are expected to remain unchanged until further notice. The Affected Mirror Fund will continue to be valued at zero and suspended to redemption and switch-out requests. Any instructions to redeem or switch out of the Affected Mirror Fund which have been submitted since 28 February 2022, or which are received until further notice, will automatically be cancelled. 

Liquidation proceeds from the Underlying Russian Assets

Any proceeds from the sale of the Underlying Russian Assets, after deduction of associated transaction costs, that FPIL receive from the Underlying Fund will be distributed to policyholders in proportion to their unit holding in the Affected Mirror Fund as at the Underlying Fund Liquidation Date. 

We will contact affected policyholders with further information as and when HGIF provide us with material updates regarding the Underlying Fund and the Underlying Russian Assets. HGIF confirm communications in relation to the Underlying Fund will be sent at least annually, and on an ad-hoc basis if there is a material change in circumstances, or if some/all of the Underlying Russian Assets have been sold. 

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We have contacted impacted in force policyholders and their financial advisers with notification; primarily by e-shot, with letters sent by post where we do not hold a valid email, and to those who prefer to receive letters by post. 

Separate communication will be issued in due course regarding any policies which have been “soft” surrendered leaving units in the suspended Affected Mirror Fund in place. 

Should you have any questions regarding these changes, please contact the Investment Marketing Team.

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*Fund applicable to Hong Kong designated policyholders.