HSBC Winds Down Monaco Operations
October 19 2016 - 10:50AM
Dow Jones News
LONDON—HSBC Holdings PLC Wednesday said it will exit Monaco as
the wealthy principality loses its allure for some global
banks.
HSBC's Switzerland-based private bank said it will refer Monaco
clients to CFM Indosuez Wealth Management, majority owned by
France's Cré dit Agricole. Any remaining Monaco business will be
wrapped up, HSBC said. The agreement covers clients with around $9
billion of assets and around 200 employees.
It's the latest exit for HSBC in a global shake-up of its
operations since 2011. The bank has retreated from dozens of
countries and businesses, and shrunk and restructured its private
bank. The Monaco unit, acquired in 1999 through HSBC's acquisition
of two banks from Lebanese financier Edmond Safra, is being shed
because it doesn't fit into a fresh focus on families and
affiliates of HSBC commercial clients.
"It draws to a close the restructuring of our European private
banking operations, with the future focus being on growing our
business with strategic clients of the group," HSBC Private Bank
said in a statement.
CFM Indosuez Wealth Management, describing itself as Monaco's
largest bank, said Wednesday's agreement is part of its strategy to
tap ultra-high net worth individuals in key markets.
Monaco is fertile ground for private banks because its lack of
income tax draws billionaires and other wealthy individuals. But
banks including Credit Suisse Group and Lloyds Banking Group PLC
have left in recent years to focus on customers elsewhere.
Business in the principality at times meant unwelcome attention
for HSBC.
Last year, The Wall Street Journal reported HSBC in Monaco had
been drawn into a legal case between an art dealer and one of the
bank's billionaire clients.
And an April data leak from Panama law firm showed HSBC Private
Bank (Monaco) SA helped clients set up hundreds of companies in the
British Virgin Islands and other offshore centers. Such companies
are commonly used in corporate transactions and wealth planning but
the data leak sparked global outrage over secrecy in offshore
finance.
Write to Margot Patrick at margot.patrick@wsj.com
(END) Dow Jones Newswires
October 19, 2016 10:35 ET (14:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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