If your goal for 2026 is to build sustainable passive income, I think these two FTSE 100 names are worth considering for dividends.

British-American tobacco (LSE: BATS) AND HSBC (LSE: HSBA) both companies have a long history of high and consistent payouts, although they operate in very different sectors influenced by different factors.

The British American Tobacco case

It’s worth noting that British American Tobacco may not be to everyone’s taste, given the ethical issues surrounding the tobacco industry. This is a personal assessment that investors must make.

However, from an income perspective, the stock still offers one of the most generous returns on Footsie. As I write on January 6, the company’s dividend yield is 5.9%, well above the broader index average.

This figure reflects decades of reliable cash generation and a forceful commitment to delivering shareholder returns. In fact, the company has raised its dividend almost every year for over 20 years while simultaneously implementing a share buyback program.

In terms of valuation, the company’s reliability means its shares are valued at a premium. A price-to-earnings (P/E) ratio of 29 isn’t low-cost, but it has proven to be a reliable addition to many portfolios for decades.

That said, investing involves risk. Smoking rates continue to decline in many developed countries, and while the company has entered the market for next-generation vaporizers and heated tobacco products, these markets face their own regulatory issues. Legal challenges have not gone away either and could impact future results.

Is HSBC the key to long-term passive income?

HSBC offers something different as a global, diversified banking group with a forceful presence in Asia, Europe and the Americas.

2025 was a good year for banking stocks, and HSBC was no exception. As I write this, the company’s share price is up 54.9% in the last 12 months to 1,219p per share. Like many of its peers, the elevated interest rate environment and a sufficiently forceful economy have helped maintain forceful net interest income.

However, this means that the opposite is true and the bank is exposed to the ups and downs of the global economy. This includes risks related to interest rates, loan defaults and broader financial market fluctuations.

HSBC’s dividend yield of 4% is lower than the UK and US dividend yield, but still attractive at Footsie. Importantly, HSBC has worked demanding to reshape its business, particularly in Asia, while returning more capital to shareholders.

In terms of valuation, banks are typically valued using price-to-book (P/B) and P/E ratios. HSBC’s P/B is around 1.4 and its P/E is around 17. In my opinion, it looks somewhat solid compared to peers like Barclays (LSE: BARC) i NatWest (LSE:NWG), so it’s certainly not the cheapest dividend play on the market.

My verdict

For investors looking to boost their passive income, both British American Tobacco and HSBC offer different strengths.

As always in the investing game, the purchase decision will depend on personal preference and how it best fits into a diversified portfolio over the long term. However, I believe that both Footsie dividend stocks are worth considering for investors trying to build sustainable passive income in 2026 and beyond.