HSBC to acquire Citi’s China-based consumer banking portfolio

Citi announced yesterday (Monday, October 09) an agreement to transfer its China-based consumer wealth portfolio to HSBC, for a sum of $3.6 billion. While the terms of the deal have not been disclosed, the transfer involves the full scope of Citi’s onshore consumer wealth portfolio, comprising clients, assets under management (AUM) and deposits. The transaction is expected to close in the first half of 2024.

“Our institutional business in China continues to see strong client-led growth, across Banking, Services and Markets,” a spokesperson for Citi told FinanceAsia.

Citi intends to continue to cater to affluent Chinese clients through its presence in the regional wealth hubs of Hong Kong and Singapore, where it will continue to leverage its International Personal Bank and Citi Private Bank businesses.  The agreement does not include any aspect of Citi’s institutional presence in China.

“We warmly welcome the Citi China staff to join our HSBC family and will work together to ensure a smooth transition and integration,” a spokesperson for HSBC told FA.

“We will make offers to their in-scope onshore retail wealth management staff. These are the staff supporting the portfolio we’re purchasing,” he added. 

Citi’s decision to exit the Chinese consumer market forms part of the bank’s strategic decision announced in April 2021, to withdraw its consumer franchises from 14 markets across Asia, Europe, the Middle East and Mexico, in order to refocus the bank’s efforts towards its institutional clients and wealth businesses.

Since announcing its strategic refresh, Citi has closed sales in eight markets including Australia, Bahrain, India, Malaysia, the Philippines, Taiwan, Thailand and Vietnam. The sale of its Indonesian business is expected to close later this year, while previously announced wind-downs in Korea and Russia remain in progress. In May, the bank announced it would pursue an IPO of its consumer, small business and middle market operations in Mexico.

“This transaction serves the interest of our clients, colleagues and all parties involved,” Christine Lam, country officer and head of the bank’s China business, said in the bank’s press release.

Citi first established a presence in China in 1902, before incorporating locally in 2007.