HSBC Disposes Business in Canada

On October 4th local time, the Hongkong and Shanghai Banking Corporation Limited (HSBC) is considering to sell its multibillion dollar businesses operating in Canada. There are four divisions within HSBC Canada, including commercial banking, personal banking, investment banking and markets services business.

As one of the biggest international banking brands in Canada, HSBC is aiming to increase returns in order to meet the demands of its biggest shareholders. In accordance with its most recent financial reports, HSBC is presently considering strategic options for its wholly-owned subsidiary in Canada, which had assets worth of C$125 billion and total equity worth C$5.8 billion as of June 30th.

As opposed to other businesses that HSBC has sold recently, this one is lucrative, with pre-tax profits of C$490 million in the first half of the year. The lender could choose to sell its entire ownership stake in HSBC Canada. However, the review is in its early stages, and no decisions have been made.

HSBC has reportedly made a string of divestitures, with this sale being the most recent. It revealed last May that it was leaving the U.S. mass-market banking industry and announced in June that it was selling its French retail business.

The actions were taken as part of a strategy in an effort to increase profits and fight off demands from its largest shareholder Ping An Group to spin off its Asian operations. Since April, Ping An Group has been putting pressure on the UK to consider possibilities for listing its Asian operations in order to boost shareholder returns.