Citigroup to Sell its Consumer Wealth Portfolio to HSBC Holdings

On October 9, Citigroup Inc. announced an agreement to sell its China consumer wealth portfolio, which includes clients, assets under management (AUM), and deposits, to Asia-focused HSBC Holdings Plc. The transaction will cover approximately $3.6 billion in deposits and investment AUMs and close in the first half of 2024. The transaction's financial specifics were not released.

"Today's announcement progresses the wind-down of Citi's consumer banking business in China, which was announced in December 2022," the US-based bank said in a statement.

Citi revealed its intention to depart China consumer banking in April 2021 as part of a global strategy overhaul. The consumer banking business primarily served wealthy clients with deposit, fund, and structured product offerings.

Reuters first reported late last month that HSBC was set to acquire Citi's China consumer wealth business, in a major boost to the London-based bank's business in the world's second-largest economy.

Citi's consumer banking operation in China is overshadowed by Chinese banks and foreign competitors such as Standard Chartered, who all have more retail branches handling wealth management. The acquisition of Citi's wealth portfolio will assist HSBC in expanding its footprint in China, one of its main markets, as Europe's largest lender commits to abandoning less profitable countries to focus on Asia, its key income source.

HSBC may now provide wealth management solutions, mobile fund, and insurance solutions in mainland China based on regulatory permissions received in previous years, the bank said in a statement on Monday. In January, HSBC announced a strategic investment in Shanghai MediTrust Health Technology Co. Ltd.