HSBC Holdings said Monday it will record a $1.1 billion provision in its third-quarter results after losing part of an appeal in a long-running lawsuit linked to Bernard Madoff’s Ponzi scheme.

The bank acted as a service provider for several funds that invested with Bernard L. Madoff Investment Securities LLC. In 2009, Herald Fund SPC sued HSBC’s Luxembourg unit seeking restitution for assets it claimed were lost in the fraud.