HSBC better late than never with U.S. exit

Cathay General Bancorp

27/05/2021 04:02

(The authors are Reuters Breakingviews columnists.  The
opinions expressed are their own.)
    By Jennifer Hughes and Antony Currie
    HONG KONG, May 27 (Reuters Breakingviews) - It’s selling
much of its American retail business to Citizens and Cathay for
a song. There’s little capital relief from this sober end to a
pricey, decades-long effort. At least it finally removes a
distraction so that boss Noel Quinn can put the needed attention
on Asia.
    Full view will be published shortly.
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    CONTEXT NEWS 
    - HSBC said on May 26 that it would exit U.S. mass-market
retail banking by selling parts of its operation and winding
down others.
    - Citizens Financial agreed to buy HSBC’s East Coast
business, including 80 branches, $9.2 billion of deposits and
$2.2 billion of outstanding loans as of March 31. Cathay General
Bancorp is buying the West Coast business with 10 branches, $1
billion of deposits and $800 million of outstanding loans as of
March 31, HSBC said.
    - HSBC added that it expects to incur $100 million of
pre-tax costs related to the transactions.
    - The risk-weighted assets associated with the deals were
$1.8 billion as of March 31, and no material impact is expected
on its core equity Tier 1 ratio.
    - HSBC will keep up to 25 branches as what it calls
international wealth centres. Some 40 branches that are not part
of the sales or the rebranding will be closed.
    
    - For previous columns by the author, Reuters customers can
click on  HUGHES/  and  CURRIE/  
 

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Citizens Financial statement    https://www.businesswire.com/news/home/20210526006133/en/Citizens-Financial-Group-Inc.-to-Acquire-HSBC-East-Coast-Branches-and-National-Online-Deposit-Business
Cathay General Bancorp statement    https://www.cathaybank.com/CGB/pr-20210526
HSBC says to exit U.S. retail banking  urn:newsml:reuters.com:*:nL2N2NE01U    https://www.reuters.com/article/hsbc-hldg-usa/update-1-hsbc-says-to-exit-us-retail-banking-idUSL2N2NE01U
BREAKINGVIEWS - HSBC’s sparrow hardly makes it spring   
 urn:newsml:reuters.com:*:nL1N2MK031
BREAKINGVIEWS - HSBC breakup will turbocharge CEO’s Asia pivot  
  urn:newsml:reuters.com:*:nL1N2IR24Z
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Column by Jennifer Hughes in Hong Kong and Antony Currie in
Melbourne. SIGN UP FOR BREAKINGVIEWS EMAIL ALERTS http://bit.ly/BVsubscribe
 | Editing by Jeffrey Goldfarb and Katrina Hamlin)
 ((jennifer.hughes@thomsonreuters.com; Reuters Messaging:
jennifer.hughes.thomsonreuters.com@reuters.net))