HSBC said on Monday that it will recognize a provision of $1.1 billion in its third quarter results following a court ruling in Luxembourg related to the Bernard Madoff investment fraud case.

Herald Fund SPC sued HSBC's Luxembourg unit in 2009, claiming restitution of securities and cash it said were lost in the fraud.

The court denied HSBC unit's appeal in respect of Herald's securities restitution claim, but accepted the unit's appeal in respect of the cash restitution claim.

The bank will now pursue a second appeal before the Luxembourg Court of Appeal, and added that if unsuccessful, it would contest the amount to be paid in subsequent proceedings.

HSBC's London-listed shares dipped at the start of the European trading session on Monday, falling 0.94%.

Madoff was described as t

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