The company intends to sell this business as a part of an overall cost cutting strategy.
HSBC, the worldwide banking giant, has just announced its latest insurance news in its intentions to step out of the industry in Singapore, as the latest element of its strategy to reduce costs.
The deal for the Singapore business of the company has been valued at approximately $19.3 million.
HSBC has been working to offload many of its non-core assets, and this insurance news is only the most recent in that strategy. So far, an agreement has been reached with AXA Life Insurance Singapore. This would include the sale of two coverage portfolios from HSBC within the city state.
The insurance news would involve the second largest general insurer in the country by revenue.
This, according to AXA, itself, which has entered into the insurance news deal to purchase both the life and health portfolios from HSBC. It is expected that the transaction will be completed at some point before the end of 2013.
According to the lender, which is based in London but that has a considerable focus in Asia, “The sale… represents further progress in the execution of the group’s strategy.” The company has been performing a wide scale streamlining throughout its operations around the world. It has been working hard to slash its costs as a part of an effort that the bank announced in 2011 to try to save up to $3.5 billion in costs by the end of this year.
As a further part of that effort, HSBC made insurance news headlines by eliminating 30,000 jobs around the world. In March, the bank said that its net profit in 2012 had fallen by 16.5 percent. This was the result, in part of massive scandals involving the mis-sale of its products, money laundering fines in the United States, increasing taxes, and a massive accounting charge.
In February, there was insurance news in China when the sale of the bank’s business took place there. The deal, in that case, was for its stake in Ping An. That massive insurer is the second largest in the nation’s life coverage industry. That sale went through for $9.4 billion and sold to a conglomerate from Thailand.