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RBS may sell its Indian commercial and retail unit to HSBC

Thursday, June 24, 2010

A buzz has taken strong shape about Royal Bank of Scotland Group Plc that the company may sell its Indian commercial and retail unit to HSBC Holdings Plc. The news is confirmed by economictimes.indiatimes.com, an online news portal about business and economy.

The news portal quotes a statement, “The sides may agree a deal as early as next month. The unit has about 1.3 million customers, 1,800 employees and 28 branches. The bank has announced the sale of four overseas units this week after agreeing to sales in Argentina, Kazakhstan, Pakistan and the United Arab Emirates.”

Further the news portal reports, “Banco Santander SA, Spain’s biggest bank, offered as much as 1.7 billion pounds ($2.52 billion) to buy more than 300 RBS branches in the U.K.”

About the assets of bank, the news portal quotes, “The bank’s assets ballooned to more than 2.2 trillion pounds, about 1 1/2 times Britain’s annual economic production at its peak in 2008. Following the world’s biggest bank bailout in 2008, assets fell to 1.58 trillion pounds at the end of March.”

“…HSBC, Europe’s largest bank, on Thursday agreed to buy the RBS Kazakh retail unit for as much as $52 million in cash as it bolsters its presence in countries trading with China. A spokesman for London-based HSBC declined to comment on talks about a possible purchase of the RBS India unit. At the moment, the bank has 2 million customers and 35,000 employees in 50 branches across India.”

In the conclusion, the news portal writes, “RBS is withdrawing from 16 countries and scaling back in a further 21. It will remain in 17 “core countries,” including the U.S., Australia, China, France, Germany, the Netherlands, Sweden and Spain.”

It is the biggest news in banking sector after merge of Bank of Rajasthan in ICICI. Let’s see what happen in coming future about the talk. RBS may sell its Indian commercial and retail unit to HSBC or not?
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