Major international bank quits South Africa
UK-based bank, HSBC has announced that it has reached an agreement to transfer the business of its branch in South Africa to FirstRand Bank, marking its exit from the country.
The group said the transaction will include the transfer of the branch’s clients and banking assets and liabilities, and will provide transferred clients with continued access to banking services in South Africa.
HSBC’s branch employees will also transfer to FirstRand as part of the agreement.
The London-based bank has been operating in South Africa since 1995.
The transaction is expected to be completed in the fourth quarter of 2025, subject to regulatory and governmental approvals.
HSBC said its current international wholesale banking clients will continue to have connectivity through HSBC channels for their accounts in South Africa once they have transferred to FirstRand.
The transaction will also support HSBC’s global clients who require future access to corporate banking products and services in South Africa.
HSBC South Africa will continue to serve its branch clients as usual until the transfer of the business is completed.
In addition, HSBC has agreed with Absa to provide HSBC Bank plc’s global equities and securities finance clients with continued access to the South African market.
“HSBC’s legal entities in the country will be wound down, whilst ensuring all regulatory and customer obligations are met,” the group said.
“Following a strategic review, we are pleased to have signed agreements with FRB and Absa. They both have extensive networks and are leading corporate and investment banks in the region. They will continue to provide clients with a broad offering in terms of service and products,” it said.
FirstRand said the transaction is expected to be completed in the fourth quarter of 2025, subject to regulatory and governmental approvals.
“FirstRand will allocate the required capital to back the transferred risk weighted assets, which meets the
group’s financial resources allocation principles. The impact of this allocation on FirstRand Limited’s CET1
ratio is not expected to exceed 20 bps,” it said.
HSBC is the latest in a string of European banks to make their exit in South Africa following strategic reviews.
BNP Paribas SA officially closed its corporate and investment bank in South Africa in May 2024.
Barclays Plc and Standard Chartered Plc have both scaled back in Africa, while rival Societe Generale SA is also cutting its footprint on the continent.
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