HSBC announced the acquisition of Citi Group's retail wealth management business in China, as the US bank continues to wind down its Asian consumer franchise business, which it launched two years ago. The London-based bank is acquiring a $3.6 billion portfolio from Citi, which comprises deposits and other assets in mainland China but does not contain credit cards, mortgages, or other loans, according to HSBC.
Citi said late last year that it was looking to shed its consumer banking business in China as part of a regional withdrawal from the sector. The move comes as HSBC builds up its wealth business in China. The bank expects the number of adults in the country with at least $250,000 in net wealth to double to around 351 million by 2030, it said in the announcement, as per Nikkei asia.
"Mainland China is central to our ambition to be the leading wealth manager in Asia. This investment will allow us to further build out our core wealth business in HSBC Bank China," Nuno Matos, CEO for wealth and personal banking at HSBC, said in the statement.
Citi's retail wealth management division in China will be integrated into HSBC's wealth and personal banking activities in the country. Since 2020, HSBC's wealth and personal banking in China has reported a pretax loss in the first half of the year.