HSBC to sell German private banking arm to BNP Paribas

BNP Paribas has struck a deal to acquire HSBC’s German private banking arm. The French lender is looking to expand in wealth management, and the London-based giant is continuing its pivot to Asian markets.

BNP said on Monday that the deal is expected to close in the second quarter of 2025, subject to regulatory approval.

It added that the purchase would push the assets under management of BNP’s local wealth management business past the €40bn (£33.5bn) mark.

“This acquisition will allow us to consolidate our position as the top player in private banking in the eurozone,” said Vincent Lecomte, a BNP executive.

BNP, the biggest bank in the eurozone, said the purchase would increase its exposure to entrepreneurs in Germany. The lender did not disclose any financial details of the deal.

The news underscores the continuation of HSBC’s strategy to gradually reduce its global footprint and focus on Asia under new chief executive Georges Elhedery, who took over from Noel Quinn earlier this month.

HSBC had tried to carve out a reputation as “the world’s local bank,” but Quinn’s tenure has been marked by efforts to improve shareholder returns, partly by exiting non-core markets and focusing on India, Singapore, and China.

HSBC has exited retail markets in the US and France and completed the sale of its Canadian unit to RBC in March.

The London-based bank struck a deal to offload its business in Argentina in April, booking a $1.1bn (£877m) impairment tied to the sale in its first-quarter earnings.

Quinn said in April that the recent sales would allow the bank “to focus on markets with higher-value international opportunities”.

Banks all over the world, including HSBC, have seen their profits lifted by the increase in global interest rates over the past few years, but tight monetary policy will be less of a tailwind in the months ahead – encouraging more cost-cutting efforts.