Following the decision to sell most of HSBC Cayman’s retail and commercial business to Butterfield, the effect on the bank’s employees is still uncertain.
In response to questions by the Cayman Compass about the future of the HSBC staff, a spokesperson for the bank said, “As discussions are still under way with our employees in this regard, it would be inappropriate for us to comment.”
HSBC Cayman will remain in the country to manage the run-off of the residual business after the sale, the bank said. The sale of retail and commercial banking assets worth around $800 million to Butterfield is expected to be concluded in the fourth quarter of this year. HSBC has total assets of around $1.4 billion in Cayman.
Other parts of HSBC in Cayman will remain unaffected by the sale, the spokesperson said. “The proposed sale of onshore banking business offered by HSBC Bank (Cayman) doesn’t impact other HSBC operations and businesses in Cayman, including HSBC Brazil’s class ‘B’ bank.”
HSBC made the decision to sell the retail and commercial banking business after a strategic review.
The HSBC spokesperson said all HSBC businesses are “assessed against strategic filters” on an ongoing basis. “This has been an ongoing global review process since [group CEO] Stuart Gulliver announced the strategy in May 2011.”
The review reversed HSBC’s global expansion strategy, aimed for a stricter allocation of capital and included plans to cut between $2.5 and $3.5 billion in costs over two years.
“We are not going to try to be all things to all people in all markets,” Mr. Gulliver said in 2011. “We must allocate capital in a more disciplined way than in the past.”
The strategic review included a pull-back of the bank’s retail presence, which in 2011 was not large enough and under-performing in 39 countries, according to Mr. Gulliver.
Although HSBC did not indicate at the time how many retail markets the bank would ultimately abandon, Cayman now has become one of them.