HSBC sells 195 US branches for $1 bn

HSBC sells 195 US branches for $1 bn

– Sun Jul 31, 9:00 pm ET

NEW YORK (AFP) – British-based banking giant HSBC has announced it will sell 195 retail branches, primarily in upstate New York, to First Niagara Bank for an estimated $1 billion.

"As part of its ongoing US strategic focus on commercial and corporate banking, HSBC Bank USA remains committed to serving and further developing corporate banking relationships in Upstate New York," the company said in a statement.

"HSBC Bank USA is pleased to be working with First Niagara on this transaction, given its strong commitment to relationship banking and its historic roots in the region."

As of May 31, the branches held approximately $15 billion in deposits.

In addition to the sale of the retail branches to First Niagara, HSBC Bank USA has decided to consolidate some 13 branches located in Connecticut and New Jersey into nearby HSBC branches by the first quarter of 2012, subject to regulatory approval.

Reports say the global banking giant is preparing to ax between 10,000 and 15,000 jobs in the coming year as part of a drastic cost-cutting drive.

The bank, headquartered in London but with a major focus on Asia, was set to unveil the job cuts on Monday as it posts its half-year results, Britain's Sky News television reported, without citing its sources.

Sounds like it may just be USA...not sure though

HSBC to cut 30,000 jobs in global overhaul
By MEERA SELVA, AP



LONDON — British banking company HSBC said Monday it will cut 30,000 jobs worldwide by 2013 and sell almost half its bank branches in the U.S., part of a new strategy to cut back on retail operations in some parts of the world and focus instead on fast-growing emerging markets.

The bank, which reported a 3 percent increase in pretax profits to $11.5 billion in the six months to June, has already cut 5,000 jobs this year.

Bank spokesman Patrick Humphris said another 25,000 will be slashed by 2013. HSBC currently employs around 296,000 people worldwide.

Humphris declined to give details of where the job cuts would be but said the group is still hiring in emerging economies such as Brazil and Mexico.As part of its restructuring, HSBC will sell 195 retail banking branches in the United States to First Niagara Bank for around $1 billion. Most of the branches to be sold are in upstate New York, while six are in Connecticut. Four more are northern Westchester County, and two in Putnam County.

The bank is still dealing with the legacy of bad loans in the U.S. from the 2003 acquisition of consumer lender Household International Inc. The acquisition made HSBC the biggest subprime lender in the United States at the time, which resulted in billions of losses to HSBC leading up to the financial crisis of 2008.

"I am pleased with there results, which mark a first step in the right direction on what will be a long journey," New chief executive Stuart Gulliver said in a statement.

The bank also increased its dividend by 12.5 percent to 18 cents per share.

News of the bank's overhaul and its profit — earnings per share rose to 51 cents in the first half from 38 cents a year earlier, allowing for a 12.5 percent divident increase to 18 cents — boosted the company's share price.

By mid morning in London, shares in HSBC Holdings PLC were up 4.4 percent at 620.80 pence (10.19).