HSBC decides to close its operations in Pakistan
April 06, 2012
KARACHI: HSBC Holdings Plc, one of the largest UK-based banking and financial services organisation in the world, has decided to close its banking operations in Pakistan as a part of its global strategic overhaul, banking industry sources said on Thursday.
“The bank has formally approached the central bank for sale of its retail business in Pakistan,” a senior banker said while requesting anonymity.
HSBC Holdings Plc, commonly known as HSBC, is the second largest foreign bank in terms of assets operating in Pakistan. Globally, it has a presence in 85 countries and territories in six geographical regions: Europe, Hong Kong, Rest of Asia-Pacific, Middle East and North Africa (MENA), North America and Latin America with the network of around 7,200 offices.
Banking industry sources said that initially three banks including MCB Bank, United Bank Limited and KASB Finance have shown interest to acquire HSBC banking operations in Pakistan.
“However, MCB Bank and KASB Finance have formally requested the State Bank of Pakistan (SBP) for a permission to initiate due diligence,” a source said.
According to SBP’s quarterly review report on the banking sector, HSBC Bank Middle East Limited (Pakistan Operations) has total assets worth Rs56.94 billion as of December 31, 2010 with advances of Rs22.24 billion and deposits to the tune of Rs46.46 billion, while the equity of the bank is reported at Rs6.199 billion.
A senior official at HSBC Pakistan when contacted for comments was reluctant to share divulge any information. “It is not appropriate to discuss the issue at a time when the central bank has not approved such bid,” the official said. It may be pointed out that a leading UK-based newspaper last month reported that the HSBC was planning to scale back its Asian operations with the consideration for the sale or closure of seven Asia retail businesses from Pakistan to New Zealand, where the bank reported decided to no longer focus investment.
The paper reported that the bank had already sold or closed down its retail banking operations in Japan and Thailand and sold its Asian insurance businesses.
The key Asian markets are for HSBC focus are reportedly Australia, China, India, Indonesia, Malaysia and Singapore, while the strategic markets are Taiwan.
The paper also reported that in Asia, HSBC has a string of markets where it only has between about 10 and 20 branches, which are now likely to be sold or shut.
These are Bangladesh, Brunei Darussalam, Macau, New Zealand, Pakistan, the Philippines and Sri Lanka.
HSBC Holdings Plc, however, clarified the news item saying it had no plans to leave any countries in Asia or close some consumer units in the region.
“The bank has formally approached the central bank for sale of its retail business in Pakistan,” a senior banker said while requesting anonymity.
HSBC Holdings Plc, commonly known as HSBC, is the second largest foreign bank in terms of assets operating in Pakistan. Globally, it has a presence in 85 countries and territories in six geographical regions: Europe, Hong Kong, Rest of Asia-Pacific, Middle East and North Africa (MENA), North America and Latin America with the network of around 7,200 offices.
Banking industry sources said that initially three banks including MCB Bank, United Bank Limited and KASB Finance have shown interest to acquire HSBC banking operations in Pakistan.
“However, MCB Bank and KASB Finance have formally requested the State Bank of Pakistan (SBP) for a permission to initiate due diligence,” a source said.
According to SBP’s quarterly review report on the banking sector, HSBC Bank Middle East Limited (Pakistan Operations) has total assets worth Rs56.94 billion as of December 31, 2010 with advances of Rs22.24 billion and deposits to the tune of Rs46.46 billion, while the equity of the bank is reported at Rs6.199 billion.
A senior official at HSBC Pakistan when contacted for comments was reluctant to share divulge any information. “It is not appropriate to discuss the issue at a time when the central bank has not approved such bid,” the official said. It may be pointed out that a leading UK-based newspaper last month reported that the HSBC was planning to scale back its Asian operations with the consideration for the sale or closure of seven Asia retail businesses from Pakistan to New Zealand, where the bank reported decided to no longer focus investment.
The paper reported that the bank had already sold or closed down its retail banking operations in Japan and Thailand and sold its Asian insurance businesses.
The key Asian markets are for HSBC focus are reportedly Australia, China, India, Indonesia, Malaysia and Singapore, while the strategic markets are Taiwan.
The paper also reported that in Asia, HSBC has a string of markets where it only has between about 10 and 20 branches, which are now likely to be sold or shut.
These are Bangladesh, Brunei Darussalam, Macau, New Zealand, Pakistan, the Philippines and Sri Lanka.
HSBC Holdings Plc, however, clarified the news item saying it had no plans to leave any countries in Asia or close some consumer units in the region.
