HSBC says to shut down private banking operations in India

Global banking major HSBC Holdings Plc will shut down its private banking business in India, according to CNBC-TV18 sources.

Earlier in June, HSBC’s chief executive officer Stuart Gulliver, presented a roadmap to close loss-making businesses, cut down its network, a move that would impact 25,000 jobs globally.

“We aim to achieve sustainable growth by supporting needs of customer in retail banking and wealth management, global banking and markets and commercial banking businesses”, the spokesperson said. Private banking customers, too, would be given the option to move to retail banking services.

The organisation is silent on the size of portfolio handled by its private banking division in India or the number of people employed in the division.

The London-based lender will move employees from the Indian private banking arm to the Premier banking business under HSBC’s retail bank, the people said, asking not to be identified as the information is private.

The global bank’s private banking division has been at the centre of a black money probe after an investigation by ICIJ, a global journalists’ collective, found out that more than 1,000 Indians had parked around $4 billion in HSBC Geneva till 2007.

The private banking business used to offer onshore wealth management advisory to clients, which included investment in mutual funds, bonds, debentures and other structured products.

Headquartered in the UK, HSBC is said to be the world’s fourth largest bank by total assets, with total assets of US$2.67 trillion.

Many foreign wealth managers scrambled to open up shop in India a few years ago lured by its long-term growth prospects.

Even though India’s economy has been minting millionaires at a strong pace, it has failed to translate into profits for the foreign wealth managers that have set up teams of well-paid bankers to help manage those riches.

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Saturday, November 28th, 2015 EN

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