HSBC might be withdrawing from US retail banking

HSBC (NYSE: HSBC) is considering exiting US retail banking to redistribute resources to more profitable businesses in Asia, the Financial Times reported, citing two people familiar with the matter. The top management wants to present the plan to the HSBC board in the coming weeks, they said. Closing the US retail network would end the bank's 40-year attempt to operate a full-service universal bank in the US. The division posted a pre-tax loss of $ 518 million for the first three quarters of 2020, after posting losses of $ 279 million last year and $ 182 million in 2018. It also strengthens HSBC's roots in Asia. Eventually the company started out as the Hong Kong and Shanghai Banking Corporation in 1865. Managers are also likely to propose scaling down HSBC's client roster to focus on international clients, especially those with ties to the Middle East and Asia, the FT said. After closing 80 branches this year, the company now has ~ 150 branches on the east and west coasts of America, a fraction of the branch network of JPMorgan and Bank of America. Another option is to switch to a purely digital model that focuses on international customers.