HSBC To Close Its Business (Personal Finance & Wealth) In New Zealand
The HSBC bank announced its decision to close its business related to wealth management and personal banking in New Zealand. This is part of a larger drive by HSBC to exit from less profitable markets.
By exiting markets like this, HSBC wants to focus its attention and resources on expansion into other Asian markets. One key thing to note here is that the process will be carried out based on a strategic review & thus will take several years at best.
It appears that HSCB wants to exit from New Zealand in a planned manner which is the reason behind dividing its exit into several phases.
Changed Dynamics Of The Business
According to HSBC, investing in personal finance and wealth management in New Zealand can no longer be justified. They also cited how the operating requirements have changed over the years, which has ultimately effected the scalability of its core business.
Just last year, the HSBC bank announced that it would be reviewing its banking business to decide the best possible outcome. At that time, HSCB made it clear that it might even opt to sell its business if it was no longer viable.
HSBC is a dual-listed bank with a presence in Hong Kong and the London stock markets. And it appears that New Zealand is the next target market from where the bank will be taking an exit.
Overall, HSBC is planning to exit from at least 1 market from a total of 5 in order to improve profitability and focus on Asian expansion.
That's why it wouldn't be wrong to say that HSCB is now pivoting towards Asia. However, it will be coming at the expense of selling its business in Canada, Russia, Greece, and France.
This move also highlights a fundamental shift away from the usual markets towards other countries which are emerging as more competitive and lucrative!