The move, announced yesterday, is part of an ongoing review of NatWest's investment banking business by Chip Kruger, head of NatWest Markets.
Mr Kruger is concentrating on "refocusing the investment banking business", according to a spokesperson yesterday. "It is of benefit to both our clients and our management if we concentrate on markets where we have a competitive advantage," she added.
NatWest stressed yesterday that the Hong Kong decision was unassociated with persistent market rumours that NatWest Markets, like Barclays' investment banking arm BZW, was up for sale. "The decision is purely driven by internal priorities," said a spokesperson.
Speculation that NatWest was about to sell off parts of NatWest Markets reached fever pitch last week when it was revealed that, after engaging in two weeks of formal talks with Deutsche Morgan Grenfell (DMG), NatWest had received an "unsolicited approach" from DMG for its equities business. NatWest rejected DMG's bid, saying that it was not in the best interests of either "its employees or its shareholders".
Despite its decision to close down its Hong Kong global debt market operations, NatWest still has a sizeable presence in Hong Kong. Its interests include Coutts, NatWest's up-market retail bank, as well foreign exchange and treasury activities.
Confirmation of the imminent sale of BZW's equities and corporate finance arms remained elusive yesterday, however, with its parent Barclays understood to be locked in final negotiations with the only remaining potential buyer, Credit Suisse First Boston.
Shares in the bank eased back to close at 1,500p as traders worried the delay might be more than just a technicality.
- Lea PatersonReuse content