On June 11th, HSBC China announced that it had completed the acquisition of Citibank (China) Limited's personal wealth management business in mainland China. With the completion of the transaction, HSBC China has taken over Citigroup's personal wealth management clients and related assets in 11 major cities across the country. Meanwhile, over 300 former Citigroup employees have officially joined HSBC.
This transaction is part of Citigroup's global strategic adjustment plan to gradually shut down its personal banking business in mainland China, announced in 2022. In October last year, HSBC China and Citigroup China reached the above-mentioned transaction agreement.
The reporter noticed that the business scope of this acquisition is Citigroup China's personal wealth management business (excluding insurance sales), and does not involve other retail businesses such as Citigroup China's credit cards, personal housing loans, and other loans. It is reported that Citigroup China has reached an agreement with Fubon Huayi Bank to transfer personal credit card business and unsecured loan related assets in mainland China this year.
HSBC Group: will increase its layout in wealth management business and invest more in talent strategy
On October 9, 2023, HSBC China announced an agreement with Citigroup China to acquire its personal wealth management business in mainland China, covering Citigroup China's investment assets and personal deposits in 11 major cities across the country, totaling approximately $3.6 billion (as of August 2023).
With the completion of the acquisition transaction, HSBC China has taken over Citigroup's personal wealth management clients and related assets in 11 major cities across the country. It is reported that these 11 cities include Beijing, Shanghai, Guangzhou, Shenzhen, Dalian, Chengdu, Hangzhou, Nanjing, Chongqing, Tianjin, and Changsha.
HSBC China President and CEO Wang Yunfeng said, "HSBC is firmly optimistic about the development potential of the Chinese market and continues to increase investment in the long run. In recent years, the group's investment in mainland China has reached billions of yuan, with a considerable portion focused on the rapidly developing wealth management field. After the completion of this acquisition, we can further consolidate our competitive advantage in the wealth management field of foreign banks, and continue to fully leverage our cross-border financial services expertise to support domestic and foreign clients in seizing opportunities for deep integration between China and the world economy."
In recent years, HSBC Group has continued to invest in the mainland Chinese market, increasing its layout in wealth management business and investing more in talent strategy to support sustainable business growth. HSBC stated that by the end of 2024, the total number of employees under its "Big Wealth Management" matrix will reach approximately 6000.
In 2023, HSBC Group's wealth management investment assets in mainland China increased by 53% compared to the previous year, and the total number of wealth management clients increased by more than 30% year-on-year. In the first quarter of this year, the group's net value of new investment assets in the Asian market increased by 33% year-on-year to $19 billion, with the mainland Chinese market also making a contribution, with its net value of new investment assets almost doubling year-on-year during the same period.
Citigroup will continue to serve corporate and institutional clients in China
The gradual closure of personal banking business in mainland China is part of Citigroup's global strategic adjustment and transformation. As early as April 2021, Citigroup announced a global strategic adjustment to withdraw from its personal banking business in more than ten markets, including mainland China. In December 2022, Citigroup announced that it would gradually close its personal banking business in mainland China, but not involving its market leading corporate business.
In addition to reaching an acquisition agreement with HSBC for personal wealth management business, Citigroup has also reached an agreement with Fubon Huayi Bank to transfer personal credit card business and unsecured loan related assets in mainland China within this year.
Since Citigroup announced its withdrawal from personal banking business in 14 global markets in Asia, Europe, the Middle East and Mexico, it has completed the sale of personal banking business in 9 markets, including Australia, Bahrain, India, Indonesia, Malaysia, the Philippines, Taiwan, China, Thailand and Vietnam.
In addition, Citigroup will also close its personal banking business in South Korea. Citigroup also announced that it will seek IPOs for its personal banking, small business, and mid market businesses in Mexico, and will restart plans to sell its personal banking in Poland.
It is worth mentioning that while gradually shutting down personal banking business in mainland China, Citigroup will continue to serve Chinese corporate and institutional clients. For the sale and transfer of Citibank's personal retail wealth management business in mainland China to HSBC, Citibank's corporate and institutional client business in mainland China will not be affected by this transaction. "Citigroup will continue to support our corporate and institutional clients by providing them with banking services in the local Chinese market, Asia Pacific market, and even global markets," Citigroup said. At present, Citigroup Services operates 70% of the Fortune 500 companies in China, more than 300 leading Chinese companies, and numerous emerging and new economy enterprises.
It is reported that Citigroup is actively seeking to establish a wholly-owned securities company and a wholly-owned futures company in mainland China.