DUBAI: HSBC Saudi Arabia said it had agreed to transfer its asset management, retail brokerage and retail margin lending businesses to Alawwal Invest, a unit of the Saudi British Bank (SABB).
The deal allows HSBC Saudi Arabia to focus on its investment banking, institutional brokerage and custody business, it said in a statement on Tuesday.
“This transaction will allow HSBC Saudi Arabia to focus its resources on its market-leading investment banking, institutional brokerage and custody businesses, which serve domestic as well as international corporate and institutional clients in the Kingdom,” said Stephen Moss, HSBC Group’s regional CEO.
Gulf banks are experiencing a wave of mergers and acquisitions as lenders reposition themselves in response to a number of disruptive forces that are rapidly reshaping the financial sector.
The HSBC Group owns 51 percent of HSBC Saudi Arabia, with 49 percent owned by SABB. The HSBC Group is the single largest investor in SABB with a 31 percent shareholding. The transaction is expected to complete next year, subject to approvals.
SABB Managing Director David Dew said: “The transaction enables SABB to strategically widen our service offering to our large base of clients across the Kingdom. It takes us one step closer to fulfilling our commitment toward helping our customers achieve long-term value creation by giving them access to one of Saudi Arabia’s leading wealth and asset management platforms.”
SABB is one of the largest banks in the Kingdom, with 1.54 million retail customers, and a 114 branch network.