HSBC is thinking about selling its company in Canada, which is worth billions of dollars and is one of the top international banking brands in the nation, in order to increase profits as required by its largest shareholder.
The bank stated in an email on Tuesday that it was “currently exploring our strategic options with respect to our wholly owned subsidiary in Canada.”
HSBC declined to comment on the prospective business valuation, but its most recent financial statements show that it had assets of C$125 billion ($92 billion) as of June 30 and total equity of C$5.8 billion.
The company, unlike some others HSBC has tried to sell recently, is profitable; in the first half of this year, it made C$490 million before taxes.
In other words, the lender would want to charge any potential buyer a significant premium over the property’s existing value.
The lender’s 100% ownership in HSBC Bank Canada could be sold, according to the spokeswoman, but the review is still in its early stages and no decision has been made.
The sale would be the most recent in a long line of divestitures at HSBC, which formerly branded itself as “the world’s local bank.”
In an effort to boost profits and fend off demands to separate its Asian business from its Asian operations from its largest shareholder, China’s Ping An Insurance Group, HSBC announced in May of last year that it would stop offering mass-market banking services in the United States and that it would sell its French retail business in June.
It would be a more thorough exit from the nation than those other divestments if HSBC’s review in Canada led to the total sale of its unit there.
The commercial banking, personal banking, investment banking, and markets services businesses of HSBC are all covered under the four divisions that make up HSBC Bank Canada.
According to Refinitiv data, the bank ranks eighth in terms of assets in the nation and is the biggest foreign competitor in a sector dominated by domestic incumbents.
