HSBC Holdings PLC may end a 14-year quest to build retail banking operations in South Korea by closing or selling branches in Asia’s fourth-largest economy.
The bank is reviewing options for the local retail unit, Hyonjin Suh, a Seoul-based spokeswoman, said in an e-mail yesterday.
London-based HSBC is considering shutting down operations, the Yonhap news agency reported, citing officials and regulators without identifying them.
HSBC is at a crossroads in South Korea after KDB Financial Group Inc abandoned plans to take over the business in July.
Chief executive officer Stuart Gulliver, who is seeking to revive profitability and save as much as US$3.5 billion in costs, this year decided to exit consumer banking in Japan. The lender said last week it is also in talks to divest its US$9 billion stake in Ping An Insurance (Group) Co (平安保險集團), China’s second-largest insurer.
HSBC has failed in at least three attempts to build up its South Korean retail banking business since it began operations there in 1998. In 1999, the UK lender walked away from talks with the South Korean government to buy SeoulBank.
In 2005, it lost a bid for Korea First Bank to Standard Chartered PLC.
HSBC also abandoned a US$6 billion bid to acquire Korea Exchange Bank in 2008 after authorities left the transaction in limbo for more than a year.
“[South] Korea remains an important market for HSBC; we continue to invest in developing our [South] Korean global banking and markets” units, Gareth Hewett, a Hong Kong-based spokesman for HSBC, said in an e-mailed statement.
“Until we have taken a decision, we will continue to concentrate on delivering a high level of service to our customers,” it said.