HSBC has announced it is withdrawing from US mass market retail banking, as it steps up a shift in focus to Asia, its biggest market, according to Reuters.
By selling some parts of the money-losing business and winding down others, the lender aims to shrink its presence in some European and North American markets where it has struggled against competition from larger domestic players.
In February 2021, HSBC unveiled a revised strategy focused mainly on wealth management in Asia. The bank is also seeking to sell its French retail banking operations as part of the same strategy and has entered final negotiations to sell that business to private equity firm Cerberus, Reuters reported in March 2021.
HSBC 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 very wealthy clients.
HSBC expanded into US retail banking in the 1980s as part of a broader strategy to diversify its geographical focus. However, it has been trying to walk back on this for more than a decade, and in 2011 announced the sale of nearly half of its then 470 US branches, mostly in upstate New York, and also its profitable US credit card arm.
Citizens Bank, part of Citizens Financial Group, has agreed to buy HSBC's east coast personal and small business banking business including 80 branches, and Cathay Bank, a unit of Cathay General Bancorp, has agreed to buy its west coast business including 10 branches, according to HSBC and separate statements from the two US-headquartered banks.
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