HSBC considers £6bn mega-sale after approach for insurer Ping An

 

HSBC, Europe’s largest bank, could be about to make its largest asset sale since chief executive Stuart Gulliver revealed his three-year $3.5 billion cost-cutting and rationalisation plan 18 months ago.

It admitted today that it has a received an approach for its 15.6% stake in Chinese insurer Ping An and is considering selling it in a deal which might raise more than $9 billion (£5.7 billion).

That would be useful in settling money-laundering charges with US regulators which the bank recently admitted will possibly cost more than $1.5 billion.

Gulliver originally said that selling the group’s large Chinese shareholdings — including 19.9% of Bank of Communications — was not part of his plan.

HSBC paid around $1.7 billion buying into Ping An in 2002 and again in 2005. That means it would walk away with a profit of almost $7 billion which could be used to boost its balance sheet at a time when regulators are demanding banks retain more cash against risks.

The bank issued a brief statement in Hong Kong and London in response to press reports in the former colony. “HSBC has from time to time received approaches regarding its shareholding and confirms that it is in discussions.”

The statement followed a report in the Hong Kong Economic Journal which said that the bank was in talks to sell the shares to Chia Tai Group, a company controlled by Thai tycoon Dhanin Chearavanont.

HSBC has so far sold off or closed around 41 businesses and reduced its balance sheet as measured by risk-weighted assets by some $55 billion.

A sale would require approval from China’s insurance and banking regulators, narrowing the list of possible buyers, as Chinese authorities have traditionally allowed only financial groups to take stakes in the country’s major banks and insurers. Chia Tai is a food and agriculture conglomerate.

Another challenge to a Ping An sale is the $4 billion IPO of Chinese insurer, Pacific Insurance Company of China Group, which could attract strategic buyers who might otherwise have bought HSBC’s Ping An stake. Ping An shares fell around 3% on the news and HSBC’s rose 10.55p to 660.35p.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Ashdown Group: Training Coordinator - Financial Services

£32000 - £38000 per annum + benefits: Ashdown Group: A highly successful, inte...

Recruitment Genius: Business Development Executive - Affiliates & Partnerships

£20000 - £35000 per annum: Recruitment Genius: This multi-award winning foreig...

Recruitment Genius: Retirement Coordinator - Financial Services

Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...

Day In a Page

No postcode? No vote

Floating voters

How living on a houseboat meant I didn't officially 'exist'
Louis Theroux's affable Englishman routine begins to wear thin

By Reason of Insanity

Louis Theroux's affable Englishman routine begins to wear thin
Power dressing is back – but no shoulderpads!

Power dressing is back

But banish all thoughts of Eighties shoulderpads
Spanish stone-age cave paintings 'under threat' after being re-opened to the public

Spanish stone-age cave paintings in Altamira 'under threat'

Caves were re-opened to the public
'I was the bookies’ favourite to be first to leave the Cabinet'

Vince Cable interview

'I was the bookies’ favourite to be first to leave the Cabinet'
Election 2015: How many of the Government's coalition agreement promises have been kept?

Promises, promises

But how many coalition agreement pledges have been kept?
The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

The death of a Gaza fisherman

He built his own reef, and was fatally shot there by an Israeli gunboat
Saudi Arabia's airstrikes in Yemen are fuelling the Gulf's fire

Saudi airstrikes are fuelling the Gulf's fire

Arab intervention in Yemen risks entrenching Sunni-Shia divide and handing a victory to Isis, says Patrick Cockburn
Zayn Malik's departure from One Direction shows the perils of fame in the age of social media

The only direction Zayn could go

We wince at the anguish of One Direction's fans, but Malik's departure shows the perils of fame in the age of social media
Young Magician of the Year 2015: Meet the schoolgirl from Newcastle who has her heart set on being the competition's first female winner

Spells like teen spirit

A 16-year-old from Newcastle has set her heart on being the first female to win Young Magician of the Year. Jonathan Owen meets her
Jonathan Anderson: If fashion is a cycle, this young man knows just how to ride it

If fashion is a cycle, this young man knows just how to ride it

British designer Jonathan Anderson is putting his stamp on venerable house Loewe
Number plates scheme could provide a licence to offend in the land of the free

Licence to offend in the land of the free

Cash-strapped states have hit on a way of making money out of drivers that may be in collision with the First Amendment, says Rupert Cornwell
From farm to fork: Meet the Cornish fishermen, vegetable-growers and butchers causing a stir in London's top restaurants

From farm to fork in Cornwall

One man is bringing together Cornwall's most accomplished growers, fishermen and butchers with London's best chefs to put the finest, freshest produce on the plates of some of the country’s best restaurants
Robert Parker interview: The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes

Robert Parker interview

The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes
Don't believe the stereotype - or should you?

Don't believe the stereotype - or should you?

We exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor