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HSBC has sold its retail banking network in the United States, effectively shutting down its troubled North American operations after trying to operate a full-service bank in the country for 40 years.
Europe’s largest lender first considers selling its U.S. unit, which has been losing money last year end This is part of the bank’s efforts to save approximately US$4.5 billion in costs and cut 35,000 jobs.
HSBC said on Thursday that it had sold 80 of its 148 branches on the East Coast to Citizens Bank, which also received US$9.2 billion in deposits and US$2.2 billion in outstanding repayments. loan. Cathay Bank has purchased ten branches on the West Coast. The bank has absorbed more than $1 billion in deposits and $800 million in loans. The remaining branches will be cleared.
HSBC said that, except for transactions with Citizens Bank and Cathay Bank, it would not incur “significant gains or losses”, but incurred transaction costs of $100 million.
US$3.5 billion
HSBC will invest in wealth management in mainland China and Hong Kong
The bank made most of its profits in Hong Kong, and the bank said that after selling the bank, it will retain “a small part of the physical location network” in the United States. These will become “international wealth centers” for their private banking and wealth management clients, most of them in Asia.
The sale is the latest phase of a far-reaching plan to redeploy US$100 billion in risk-weighted assets from underperforming European companies to Asia, especially in wealth and asset management. In February, HSBC Bank Say The bank will further expand its wealth management business that generates fees in Hong Kong and Mainland China. It will invest US$3.5 billion in Hong Kong and Mainland China and employ more than 5,000 consultants.
The sale of the US network brought the bank’s fate more closely linked with China. In recent years, due to increased tensions between Beijing and Washington, HSBC has been used as a political slogan.
Noel Quinn, chief executive of HSBC, said that the bank’s withdrawal from the US mass market was due to its “lack of competitive scale.”
He said: “Our continued presence in the United States is the key to our international network and an important contribution to our growth plan.”
Greg Hingston, Head of Wealth and Personal Banking, Asia Pacific, said: “The United States plays an important role in HSBC’s Asian growth strategy. The strategy we reformulate in the United States will enable us to better To meet the needs of our international wealth clients, they continue to view the United States as an international education, real estate, investment diversification, career and family mobility, and business expansion.”
Last year, HSBC closed its 80 US branches, giving it a small percentage of its network with competitors such as JPMorgan and Bank of America. Insiders believe that the insufficient scale of the sector makes it more difficult to reverse the situation, especially during the coronavirus crisis and the period of ultra-low interest rates, which forced the sector to seek higher margin fees.
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