HSBC shutters its wealth and personal banking business in New Zealand

The bank’s current strategy involves exiting less profitable businesses around the world as it focuses on expanding into several Asian markets. The process of shutting down these less profitable businesses will happen in a gradual manner over the course of a few years. 

HSBC representatives cited by Reuters talked about the changing operating requirements in the market and the scalability of its wealth and personal banking business in New Zealand. Given the current state of things, the bank can no longer justify investing in this business. 

For now, operations will continue as usual, and HSBC will help its local customers to switch to alternative personal and wealth service providers. In November 2022, HSBC announced the possible sale of its New Zealand business and revealed its plans to close 114 branches in the UK in a bid to increase returns. 

In May 2023, Reuters reported that HSBC was considering a possible exit from as many as a dozen countries, or one in five of the markets it operates in, all in a bid to gain momentum for its expansion in Asia. The lender has already triggered some of its planned business sales in Canada, Russia, France, and Greece.

What else has HSBC been up to?

Even though it now plans to exit several markets in Europe, HSBC acquired the UK arm of Silicon Valley Bank in March 2023, securing the deposits of thousands of British tech firms that hold money at the lender, amid the US collapse. At the time, Treasury representatives talked about the sale and emphasised its key role in protecting the deposits of SVB UK clients. 

SVB collapsed in the US after failing to raise USD 2.2 billion to cover a loss from the sale of assets, mainly US government bonds, which were affected by higher interest rates. SVB’s predicament caused a run on the bank in the US and sparked investor fears about the general state of the banking sector. 

In February 2023,  HSBC introduced its HSBC Merchant Box for SMEs in Hong Kong. The solution was designed to simplify international payments across regional and global ecommerce platforms for SMEs. It also makes it possible to ‘receive like a local’ at real-time exchange rates. The HSBC Merchant Box leverages the bank’s extensive global payment network and digital infrastructure to help SMEs capture local and international digital sales.