Global financial services giant HSBC Holdings Plc today said it will sell its general insurance businesses in Hong Kong, Singapore, Mexico and Argentina for $914 million in two separate cash transactions with French insurer AXA Group and Australia's QBE Insurance Group.
The move is part of HSBC's plan to divest non-core assets and to enhance focus on its core banking operations.
AXA would pay $494 million for the assets in Hong Kong, Singapore and Mexico, while QBE Insurance Group would pay $420 million for the assets in Argentina.
The transactions, which are subject to regulatory approvals, are expected to be completed during the second half of 2012, HSBC said in a statement.
After the completion of the deals, AXA and QBE would become exclusive providers of general-insurance products distributed by HSBC and its Hang Seng Bank unit to retail and commercial banking customers in Hong Kong, China, Singapore, India, Indonesia, Mexico and Argentina under 10-year bancassurance agreements.
"This is a further step in the execution of our strategy. 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," HSBC Group Chief Executive Stuart Gulliver said.
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"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 added.
HSBC said its subsidiaries HSBC Insurance (Asia), HSBC Insurance (Singapore) Pte Ltd and HSBC Seguros, SA de CV, Grupo Financiero HSBC, have entered into agreements to sell their general insurance portfolios in Hong Kong, Singapore and Mexico, respectively, to AXA Group.
Besides, HSBC Argentina Holdings SA, and HSBC Participaciones (Argentina) SA, have entered into an agreement to sell HSBC Argentina Holdings SA's general insurance manufacturing subsidiary, HSBC La Buenos Aires Seguros SA, to QBE Insurance Group.