HSBC to review Islamic fund’s $38m investment in Palantir

HSBC is to review the investment held by its sharia-compliant Islamic equity fund with the controversial American technology firm Palantir. 

The Financial Times reports that the move came after UK’s state-backed workplace pension scheme Nest - whose sharia fund is invested in HSBC’s Islamic Global Equity Index Fund - raised concerns about Palantir’s inclusion with the banking giant.

HSBC's decision comes after Muslim media outlet the Hyphen revealed that the banking giant's Islamic Global Equity Index Fund - the UK’S largest halal fund - purchased $38m worth of shares in Palantir in the first half of 2026.

MEE analysis subsequently revealed that the fund purchased over $100m worth of shares in companies linked to the Israeli military in the first half of this year.

That figure included $35.7m worth of shares in RTX, formerly Raytheon, the world’s second-largest arms company.

Sources told the FT that Nest, which had some 40,000 members invested in the fund, had received a “handful of inquiries” regarding Palantir’s inclusion in the fund.

Palantir's CEO Alex Karp has previously boasted about Israel's use of his company's technology to kill Palestinians, describing those killed as "mostly terrorists".

'Your technology kills Palestinians.' 'That's true, mostly terrorists.' Palantir CEO Alex Karp found himself challenged by a pro-Palestine protester pointing out that his company provides the Israeli army with artificial intelligence technology to 'strike targets in Gaza'. https://t.co/zR7tKBpk4Y

— Middle East Eye (@MiddleEastEye) May 4, 2025

In a statement, Nest said its senior executives had “begun discussions” with HSBC following the revelations.

In a statement announcing the review, HSBC said it “take[s] any concerns from our clients seriously and will review this matter carefully, in partnership with independent expert advisers, to assess whether the approach still meets investors’ expectations”.