Scrip Circular

RNS Number : 3579P

HSBC Holdings PLC

05 June 2015

The following regulated information, disseminated pursuant to DTR 6.3.5, comprises the scrip dividend circular for the first interim dividend for 2015 which was sent to shareholders of HSBC Holdings plc on 5 June 2015. A copy of the scrip dividend circular is available at www.hsbc.com/dividends

THIS DOCUMENTIS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are

in any doubt aboutthis document or as to the actionyou should take, you shouldconsult a stockbroker, solicitor, accountant or other appropriate independent professional adviser.

If you sold or transferred all or some of your ordinary shares on or before 20 May 2015, but those shares are included in the number shown in box 1 on your form of election or entitlement advice for the first interim dividend for 2015, you should,without delay, consult the stockbroker or other agent through whom the sale or transfer was effected for advice on the action you should take.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this document, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this document. The ordinary shares of HSBC Holdings plc trade under stock code 5 on The Stock Exchangeof Hong Kong Limited.

5 June 2015

Dear Shareholder

2015 FIRST INTERIMDIVIDEND

On 5 May 2015 your Directors declared a firstinterim dividend for 2015 of US$0.10per ordinary share. This dividend is payable on 8 July 2015 to shareholders who are recordedon the Principal register,Hong Kong or BermudaOverseas Branch registers on 22 May 2015 ('record date').You have a choice of receiving this dividend in cash in three currencies(US dollars, Hong Kong dollarsor sterling). You may also elect to receiveit as a scrip dividendin the form of new shares.

SCRIP DIVIDEND

You can elect to receivenew shares at a market value of US$9.4959(£6.2020) instead of receiving the dividend in cash. If you elect to receivenew shares, you will increase your shareholding without incurring dealingcosts or stamp duty. TheCompany will also benefitby retaining cash whichwould otherwise be payable by way of the cash dividend. At the 2012 Annual GeneralMeeting shareholders gave Directorsauthority to offer a scrip dividendscheme for a further five-year period,which will apply to this first interimdividend for 2015. The appendix to this letter sets out further details of the scrip dividend.

We encourage you to sign up to receive all communications from the Company by email.Please go to www.hsbc.com/ecomms to register your email address so that we can send you email notifications when shareholder documents are availableon our website and of your dividendentitlements.

Yours sincerely

Ben J S Mathews

Group CompanySecretary

HSBC Holdings plc

8 Canada Square, London E14 5HQ, United Kingdom Web: www.hsbc.com

Registered in England: number 617987. Registered Office: 8 Canada Square, London E14 5HQ Incorporated in England with limited liability

Appendix

How is the scrip dividendcalculated?

The scrip dividendis calculated usingthe average middle market closingprice of HSBC Holdings plc ordinary shares quoted on the London Stock Exchange for the five businessdays beginning with the ex-dividend date of 21 May 2015. The marketprice is converted to US dollars(the "Market Value") using the exchangerates quoted by HSBC Bank plc in London at or about 11 am on 29 June 2015. For this dividend the scrip price is US$9.4959(£6.2020).

The formulaused for calculating your entitlement to new shares is as follows:

Number of shares held at the record date x cash dividend per share + any residual dividend entitlement broughtforward = maximumdividend availablefor share election

Maximum dividend available = maximum number of new shares

Market Value (rounded down to the nearest whole number)

An online calculator to assist you in calculating your dividendentitlement is available at www.hsbc.com/dividends.

For example, if you own 1,000 ordinaryshares and the cash dividendis US$0.10 per ordinary share, the maximum dividend available would be US$100. The maximum numberof new shares you would receive if the Market Value was US$10 is therefore 10 new shares.

You may elect to receive new shares in respectof all or part of your holdingof ordinary shares. No fractionof a share will be issued.

If you elect to receivethe maximum numberof new shares in lieu of your dividend, a residual dividendentitlement may arise, representing the difference between the total Market Value of the new sharesand the maximum dividend available in respect ofyour shareholding. This residualdividend entitlement will be carriedforward in US dollars(without interest) to the next dividend.Therefore, we will pay you any residual dividend entitlement if you dispose of your entire holding;or receive the dividend in cash; or revoke your standing instruction to receivenew shares; or if you ask us to send it to you.

If you have less than 95 ordinaryshares you will not receiveany new sharesfor this dividend.

The new shares will be issued subject to the Articlesof Association of the Company and will rank equallywith the existing issued ordinary shares in all respects.

What is the currency conversion rate for cash dividends?

The dividend is declared in US dollars. It will then be converted into Hong Kong dollars and sterlingusing the forward exchange rate quoted by HSBC Bank plc in London at or about 11 am on 29 June 2015. For example, using the exchange rates on 28 May 2015, the US dollar cash dividend would be HK$0.7753 or £0.0653. The exchangerate to be appliedfor this dividend will be announcedto the London, Hong Kong, New York, Paris and Bermuda stock exchanges on or around 29 June 2015.

If you do not choose the currency in which to receiveyour cash dividend, you will be paid as follows:

1. Principal registerin the United Kingdom - sterling(except for those who are resident in the United States in which case it will be US dollars)

2. Hong Kong Overseas Branch register- Hong Kong dollars

3. Bermuda Overseas Branch register - US dollars.

What action is required?

Your form of election or entitlement advice (the "Form") is included with this letter. If you have registered your email address,you should have been sent an electronicversion. If you do notwish to change how you receiveyour dividend, you should take no action, your dividendwill be paid as indicatedin the Form.

If you wish to change the way you receiveyour dividend, you must either do so by 25 June 2015 usingthe online system "Investor Centre"*, returning the Form, or by writingto our Registrar, Computershare at the relevant addressgiven at the end of this letter.

We can pay your dividend direct to your bank account in the United Kingdom, United States or Hong Kong if your bank accountis denominated in the local currency.Please provide your bank accountdetails to the Registrarby completing the dividendpayment instruction section of the Form.

No acknowledgement of receipt of a form of election will be issued.

Other information

If all shareholders elected to receive new shares for the first interim dividendfor 2015, approximately 205,519,316 new shares would be issued, representing an increase of 1.05 per cent in the issued ordinary share capital of the Company as at 27 May 2015.

The total cost of the first interimdividend for 2015 if no new shares were issued would be approximately US$1,952 million. The applicable tax credit is the sterlingequivalent of approximately US$217 million.

Transfers

If you recently acquiredordinary shares registered on the Principal register in the United Kingdomor the Overseas Branch registersin Hong Kong or Bermuda, your share transfermust have been lodged with the appropriate Registrar before 4.00 pm on 22 May 2015 in order to receive the dividend.

*If you have not yet signed up to use Investor Centre you may do so at any time at www.investorcentre.co.uk or www.investorcentre.com/hk or www.investorcentre.com/bm. You can view your shareholding at any time on InvestorCentre.

Issue of share certificates and listing of new shares

Applicationswill be made to the UK Listing Authorityand to the London Stock Exchange for the new shares to be admitted to the OfficialList and to tradingrespectively, to the Stock Exchangeof Hong Kong for listingof, and permission to deal in, the new shares, and to the New York, Paris and Bermuda stock exchangesfor listing of the new shares.

Existing ordinary shares on the Principal registermay be held either in certificated form, or in uncertificated form throughCREST. If you hold ordinaryshares in both certificated and uncertificated form, each holding will be treatedseparately for the purpose of calculating entitlements to new shares.

Definitive share certificates for the new shares issued in respectof holdings in certificated form are expectedto be mailed to shareholders entitled thereto at their risk on or about 8 July 2015, at the same time as warrantsin respect of the cash dividend are mailed. New sharesissued in respectof holdings of ordinary shareswhich are in uncertificated form will also be issued in uncertificated form. The Company will arrangefor the relevantshareholders' stock accounts in CREST to be credited with the appropriate numbers of new shares on 8 July 2015.

Dealings in the new shares in London, Hong Kong, Paris and Bermuda,and in the American Depositary Shares in New York are expectedto begin on 8 July 2015.

The new shares will rank pari passu with the existingordinary shares of the Company.

Your responsibilities

Whether or not it is to your advantage to elect to receivenew shares in lieu of a cash dividendor to elect to receive payment in US dollars, sterlingor Hong Kong dollarsis a matter for individual decision by each shareholder. HSBC cannot accept any responsibility for your decision.

Overseas shareholders

No person receiving a copy of this documentor the form of election in any jurisdiction outside the United Kingdom or Hong Kong may treat the same as offering a right to elect to receivenew shares unless such offer could lawfully be made to such person without the Company being required to comply with any governmental or regulatory procedures or any similar formalities. It is the responsibility of any person outside the United Kingdom and Hong Kong who wishes to receive new shares under the scheme to comply with the laws of the relevant jurisdiction(s), including the obtaining of any governmental or other consents and compliance with all other formalities. It is also the responsibility of any person who receives new shares in lieu of a cash dividendto comply with any restrictions on the resale of the shares which may apply outside the United Kingdom and Hong Kong. For example, shareholders in Ontario who have new shares allotted to them under the Scheme must ensure that the first trade of their new shares is executed on a stock exchangeoutside Canada.

Taxation

The precise tax consequences for a shareholder receivinga cash dividend or electingto receive new shares in lieu of a cash dividend will depend upon the shareholder's own individual circumstances. The effect on the tax position of any shareholder will depend on that shareholder's particular circumstances. If you are in any doubt as to what to do, you shouldconsult your professional advisers. No tax is currently withheldfrom dividends paid by the Company. Such dividends carry a tax credit equal to one-ninth of the dividend.

To assist shareholders who receivea scrip dividend, we will send a NotionalTax Voucher which may be needed for tax returns.

Further information on taxation is providedon our website at www.hsbc.com/dividends.

Timetable of events

American Depositary Shares quoted ex-dividend in New York	20 May 2015
Ordinary shares quoted ex-dividend in London, Hong Kong, Paris and Bermuda	21 May 2015
Record date for the first interim dividend for 2015 for holders on the Principal register, Hong Kong or Bermuda Overseas Branch registers	22 May 2015
FINAL DATE FOR RECEIPT BY REGISTRAR OF FORMS OF ELECTION, REVOCATIONS OF STANDING INSTRUCTIONS FOR SCRIP DIVIDENDS AND ELECTRONIC INSTRUCTIONS	25 June 2015
Exchange rate determined for payment of dividends in sterling and Hong Kong dollars	29 June 2015
Payment date - dividend warrants mailed; new share certificates or Bermuda Overseas Branch register Transaction Advices and Notional Tax Vouchers mailed; and shares credited to stock accounts in CREST	8 July 2015
Expected first day of dealings in new shares in London, Hong Kong, Paris and Bermuda; and in American Depositary Shares in New York	8 July 2015

Communications

Shareholdersmay at any time choose to receive corporatecommunications in printed form or to receive notifications of their availability on HSBC's website.To receive, by email, future notifications of the availability of a corporatecommunication on HSBC's website,or revoke or amend an instruction to receive such notifications, go to www.hsbc.com/ecomms. If you provide an email addressto receive electronic communications from HSBC, we will also send notifications of your dividend entitlements by email. If you received a notification of the availability of this documenton HSBC's websiteand would like to receive a printed copy of it, or if you would like to receivefuture corporate communications in printed form, please write or send an email (quotingyour shareholder referencenumber) to the appropriate Registrar at the addressgiven below. Printedcopies will be providedwithout charge.

Further copies of this letter, replacement forms of electionand a Chinese translation of this and future documentsmay be obtained from the Registrar.

Principal register Hong Kong OverseasBranch register Computershare Investor Services PLC Computershare Hong Kong Investor Services Limited The Pavilions Rooms 1712-1716, 17th Floor

Bridgwater Road Hopewell Centre

Bristol 183 Queen's Road East

BS99 6ZZ Hong Kong SAR

United Kingdom Telephone: 2862 8555

Telephone: (44) 870 702 0137 Email: hsbc.ecom@computershare.com.hk Email via website: Investor Centre: www.investorcentre.co.uk/contactus www.investorcentre.com/hk

Investor Centre: www.investorcentre.co.uk

Bermuda Overseas Branch register US Shareholder helpline Investor Relations Team Telephone: 1 866 299 4242 HSBC Bank Bermuda Limited

6 Front Street

Hamilton HM 11 Bermuda Telephone: 299 6737

Email: hbbm.shareholder.services@hsbc.bm Investor Centre:www.investorcentre.com/bm

Persons whose shares are held on their behalf by another person may have been nominatedto receive communications from HSBC pursuant to section 146 of the UK Companies Act 2006 ("nominated persons"). The main point of contact for nominatedpersons remains the registered shareholder (for example your stockbroker, investment manager, custodianor other person who managesthe investment on your behalf).Any changes or queriesrelating to nominated persons' personal detailsand holding (including any administration thereof)must continue to be directed to the registered shareholder and not HSBC's Registrar. The only exception is where HSBC, in exercising one of itspowers under the UK Companies Act 2006, writes to nominatedpersons directly for a response.

Within this documentthe Hong Kong SpecialAdministrative Regionof the People's Republic of China has been referred to as "Hong Kong".

The Directors of HSBC Holdings plc are Douglas Flint, Stuart Gulliver, Phillip Ameen†, Kathleen Casey†, Safra Catz†, Laura Cha†, Lord Evans of Weardale†, Joachim Faber†, Rona Fairhead†, Sam Laidlaw†, John Lipsky†, Rachel Lomax†, Iain Mackay, Heidi Miller†, Marc Moses, Sir Simon Robertson† and Jonathan Symonds† .