The banking giant said it will exit 90 of its 148 US bank branches, with the remaining branches to be wound down or converted into international wealth centres
Holdings PLC () said it will exit the US retail banking market as part of a strategy pivot towards international banking and wealth management.
The FTSE 100 banking giant said it will exit 90 of its 148 current US bank branches, with 35 to 40 of the remaining branches to be wound down while the other 20 to 25 will be repurposed into international wealth centres.
revealed overnight that, as part of its further shift in focus to Asia, it will also exit all personal, advanced and certain premier banking customers with balances of under US$75,000, as well as all of its retail business banking customers, defined as small businesses with less than US$5mln of turnover.
As a result of the exit, the bank said its US wealth and personal banking business will now focus on the needs of “globally connected affluent and high net worth clients”, adding that it has already entered into sale agreements with rival banks to sell certain parts of the US business earmarked for divestiture or closure.
Among these is an agreement to sell its domestic mass market and retail business banking businesses on the East Coast of the US to Inc (), which will take over around 800,000 customers with US$9.2bn in deposits and US$2.2bn in outstanding loans.
Chinese-American outfit Cathay Bank has also agreed to buy ‘s West Coast domestic retail and business banking operations, comprised of around 50,000 customers with US$1bn in deposits and US$0.8bn in loans.
“Today’s announcement is an important step towards becoming a more focused, simpler and sustainably profitable organisation. A strong, internationally connected US business is an important part of HSBC’s value proposition, and we are excited to be focusing the US business in areas of competitive strength. At the same time, I am very pleased that we were able to execute this strategic repositioning at pace. It was also important for us to find buyers who would be a good fit for our customers and employees,” HSBC’s US and Americas chief executive Michael Roberts said in the statement.
“We are pleased to announce the sale of the domestic mass market of our US retail banking business. They are good businesses, but we lacked the scale to compete. Our continued presence in the US is key to our international network and an important contributor to our growth plans. This next chapter of HSBC’s presence in the US will see the team focus on our competitive strengths, connecting our global wholesale and wealth management clients to other markets around the world,” added HSBC’s group chief executive Noel Quinn.
HSBC originally entered the US retail banking market back in the 1980s but for the last 10 years has been attempting to reverse its efforts as stiff internal competition has left it…