27 May - 2 min read
HSBC has announced its withdrawal from the United States domestic mass market retail banking business, agreeing to sell and wind down parts of the money-losing business in the US. The move is viewed as part of the banking group’s long-awaited plan to focus more closely on Asia, its biggest market.
In a statement, the bank said that it would exit retail banking for most individual and small business customers, but retain a small physical presence in the US to serve its international affluent and high-wealth clients.
Earlier in February, HSBC had revealed a revised strategy that focused mainly on wealth management in Asia, stating that it was exploring organic and inorganic options for its US retail banking franchise. The London-headquartered bank has also been looking to step back from sub-scale markets and businesses as part of group CEO Noel Quinn’s strategy that involved slashing costs across the banking group. HSBC is also looking to sell its French retail banking operations, having entered final negotiations to sell the business to private equity firm Cerberus.
The bank’s US wealth and personal banking business made a loss of $547 million in 2020, versus a $5 billion profit in Asia – primarily from Hong Kong, its most profitable market. Meanwhile, its global banking and markets division, which includes its investment banking and large corporate businesses portfolios, made a profit of $572 million in the US in 2020.
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