HSBC said to explore sale of some German units in further exit from Europe to focus on Asia

HSBC said to explore sale of some German units in further exit from Europe to focus on Asia

HSBC said to explore sale of some German units in further exit from Europe to focus on Asia

HSBC Holdings is exploring the sale of various business units in Germany including its wealth-management, custody and fund administration units, according to people familiar with the matter.

The London and Hong Kong-listed lender is working with advisers on a review, they said, asking not to be identified because the talks are private. The discussions are at an early stage and there is no certainty they will lead to a sale, they added.

The bank’s corporate-banking and trading activities in the country are not affected by the review, the people said.

A spokesperson for HSBC declined to comment.

The disposals would add to HSBC’s long list of exits from business activities and countries in recent years, including North America and its French retail operations. The exits are part of a move to sharpen its focus on its core Asian operations with the bank looking to cater to German corporates with operations in Asia for instance.

HSBC CEO Noel Quinn addresses shareholders during the bank’s annual general meeting in Birmingham, England, in May 2023. Photo: Chad Bray
The UK-based lender completed the sale of its Canadian business to Royal Bank of Canada on March 28 for a US$4.9 billion gain, unlocking “significant value” for the group, according to a stock exchange filing. The group expects to take a loss from the sale of its French retail banking assets, which has been delayed since mid-2021.

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Inka, HSBC’s German fund administration business, is one of the biggest in the industry with around €400 billion (US$431 billion) of assets under administration, according to its website. Fund administration firms cater to asset managers and provide services such as accounting, financial reporting and portfolio valuations.

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The last big transaction in the custody space was Credit Agricole-owned CACEIS’s acquisition of Royal Bank of Canada’s European asset servicing operations. French investment bank Societe Generale is said to be exploring options for its custodian business.

HSBC’s German private-banking activities generated around US$90 million in revenues in 2023, according to the bank.

Banking deals in Europe have received a fresh impetus this year as some private equity funds and governments seek to sell their post-financial crisis investments. Some lenders including HSBC are streamlining their global footprints, even as others actively seek acquisitions with the tailwind from rising interest rates slowing.

Additional reporting by SCMP

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