HSBC India announces shut down of private banking
"After a strategic review of the global private banking operations in India, we have decided to close the business," a HSBC India spokesperson said in a statement.
HSBC will continue to offer corporate, retail and investment banking services in India.
Shut down not linked to black money probe
HSBC's private banking division had recently been entangled in Indian investigations to crack down on black money after an investigation by the International Consortium of Investigative Journalists found out that over 1,000 Indians had stashed $4 billion in HSBC Geneva till 2007.
However, the HSBC spokesman denied that the shut down was linked to this scandal, nor was it a cost-cutting measure by HSBC.
Customers can move to HSBC Premier
According to HSBC India's spokesperson, existing clients will be "given an option to move to" HSBC Premier, HSBC's global retail banking and wealth management platform.
The bank will continue to invest in HSBC Premier in India to enhance the range of services and products offered to customers.
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HSBC India's private banking business profits
According to Bloomberg, HSBC's Indian private banking business posted a pre-tax profit of $7 million for the first half of 2015, while its retail banking and wealth management business in India posted a $3 million loss.
HSBC to retain all employees in India
When HSBC, in 2013, closed its retail broking and retail depository service businesses in India, 300 employees had been laid off.
However, this time, according to sources, the 70 people headed by Shantanu Ambedkar working in HSBC India's private banking unit will be absorbed into its retail banking unit.
The HSBC spokesperson also added that HSBC will retain all its 32,000 employees in India.
Other foreign lenders who shut down Indian businesses
In early November 2015, Standard Chartered announced that it will cut down on its unsecured retail and corporate banking businesses in India.
In September 2015, Royal Bank of Scotland (RBS) announced that it will sell its private banking business in India to Sanctum Wealth for Rs.200 crore.
In April 2015, IndusInd Bank announced the acquisition of RBS' diamond and jewellery portfolio worth Rs.4,500 crore.