HSBC is continuing its international divestment strategy through a new agreement to sell its retail banking business in Sri Lanka to Colombo-headquartered Nations Trust Bank.
The binding sale and purchase agreement signed this week includes premium banking customers, credit cards, around 200,000 retail loans and accounts, as well as the HSBC Sri Lanka retail team, currently led by regional CEO Mark Surgenor.
While the exact terms of the deal have not been disclosed, Nations Trust Bank says it plans to fund the purchase “entirely through internally generated funds”. The full-service bank recorded $55.5 million in profits after tax for 2024, with $1.8 billion in total assets. Pending regulatory approval, the transaction is expected to close in H1 2026.
HSBC is among the oldest banks in Sri Lanka, having first established operations in the country, then known as British Ceylon, in 1892. While parting ways with retail operations, HSBC will continue to provide corporate and institutional banking services in Sri Lanka.
In a statement, HSBC says the move follows “the completion of a strategic review of the business, which concluded that a sale would be the best outcome for the HSBC Group and its employees and customers”.
This latest deal is in line with a group simplification strategy set out by HSBC in October 2024, which it states is “focused on increasing leadership and market share in the areas where it has a clear competitive advantage, and where it has the greatest opportunities to grow and support its clients”.
Since announcing this strategy, HSBC has executed several divestments: In February, it sold its retail banking operations in Bahrain to the Bank of Bahrain and Kuwait, followed by the June sale of its German custody and depositary bank business to BNP Paribas. Around the same time, it also announced plans to close its business banking unit in the US that serves around 4,400 SMEs (it already shed its US retail banking business a few years ago). In July, Brazilian investment bank BTG Pactual agreed to purchase HSBC’s Uruguayan operations for $175 million, pending regulatory approval.
Prior to the strategy shift announcement, HSBC also offloaded its retail banking business in France to My Money Group subsidiary Crédit Commercial de France, closed in January 2024, and sold its Canadian banking business to Royal Bank of Canada for $10.1 billion, completed in March 2024.
Source: https://www.fintechfutures.com/
