, HONG KONG, Mar 7 – Banking giant HSBC said Wednesday it has agreed to sell its general-insurance businesses in Hong Kong, Singapore, Argentina and Mexico for around $914 million.
The move is part of the bank’s strategy to cut costs and focus on growth, HSBC Group Chief Executive Stuart Gulliver said in a statement to the Hong Kong stock exchange.
“It will enable us to focus our capital and resources on the growth of our core businesses, including the building of our broader wealth management capabilities,” he said.
HSBC Insurance (Asia), HSBC Insurance (Singapore) and HSBC Seguros SA de CV Grupo Financiero HSBC will sell their general insurance businesses in Hong Kong, Singapore and Mexico to AXA Group for around $494 million, the bank said.
Australian insurer QBE Insurance Group would buy the general-insurance business in Argentina and Hong Kong-based Hang Seng Bank’s general-insurance manufacturing unit. Hang Seng Bank is 62 percent-owned by HSBC Group.
The deals would cost QBE around $420 million in cash.
“These long-term collaborations with AXA and QBE will broaden and strengthen the suite of general insurance products available to our retail banking and commercial banking customers in Hong Kong, mainland China, Singapore, India, Indonesia, Mexico and Argentina,” Gulliver said.
HSBC announced last year that it intended to offload its global general-insurance operations as it sought to cut costs and raise capital in the face of the weak global economy and higher capital adequacy requirements.
French insurance group AXA said it had also secured a 10-year exclusive property and casualty bancassurance agreement with HSBC in India, Indonesia and China as part of the deal.
It would make AXA the leading property and casualty insurer in Hong Kong, it added.
“With this agreement we are making a huge step towards becoming the leading property and casualty insurer in Asia,” AXA Asia Regional Chief Financial Officer Francois-Valery Lecomte said in a statement.