HSBC to close India private banking unit as competition grows
By Sumeet Chatterjee
MUMBAI (Reuters) - HSBC Holdings Plc (HSBA.L: Quote) is closing its private banking unit in India as part of its group strategy, the bank said, marking the exit of another foreign bank from the cut-throat wealth management business in Asia's third-largest economy.
The bank would offer private banking clients the choice to move to HSBC Premier, the bank's global retail banking and wealth management platform, a Mumbai-based spokesman said. The process is likely to be completed in the first quarter of 2016.
"After a strategic review of the global private banking operations in India, we have decided to close the business," the spokesman said. "This marks further progress in the HSBC group strategy to simplify business and deliver sustainable growth."
Many foreign wealth managers scrambled to open up shop in India a few years ago lured by its long-term growth prospects.
Even though India has been minting millionaires at a strong pace, it has failed to translate into profits for the foreign wealth managers that have set up teams of well-paid bankers to help manage those riches.
HSBC's private banking business in India has about 70 staff, a source with direct knowledge of the development said, adding many of them would be redeployed to other bank operations.
The bank employs about 32,000 people - many of them in its back-office outsourcing unit - in India, where it also offers corporate, retail and investment banking services. Continued...