HSBC to stop retail banking services in Australia next year
What's the story
HSBC, the London-based multinational bank and financial services holding company, has announced its exit from the Australian retail banking sector. The move comes after nearly 40 years of operation in the country. The bank will sell its local mortgage and personal loan portfolio worth $36 billion to global asset giant Blackstone. The transaction is expected to be completed by H1 2027.
Branch closures
Branches to be shut down
HSBC has 19 branches in Australia, all of which will be closed over the next 18 months.
The bank will also phase out everyday products such as savings accounts, credit cards, and term deposits during this period.
Despite these changes, HSBC plans to continue its private and institutional banking services in Australia.
Market struggles
Strategic review of HSBC Australia's retail business
The decision to exit the retail banking sector comes after a strategic review of HSBC Australia's retail business.
The bank has struggled to compete with Australia's Big Four banks and Macquarie, which dominate the market.
About 80% of the mortgage market is controlled by Australia's five biggest lenders, according to regulatory data.
Staff uncertainty
Uncertain future for local staff
The future of around 2,000 local staff at HSBC remains uncertain with this exit.
A bank spokesperson said it is too early to discuss job losses as the sale is still pending regulatory approval. However, most of the retail banking team will be retained during this transition period.
Pepper Money, a company hired by Blackstone, may offer roles to some affected employees after the sale is completed.