Monday, December 5

HSBC’s Canada unit loses National Bank, CIBC as bidders, Global and Mail reports


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National Bank of Canada and Canadian Imperial Bank of Commerce (CIBC) have dropped out as bidders for HSBC Holdings PLC’s business in Canada, while Bank of Montreal is still pursuing the deal, according to a report in The Globe and Mail newspaper.

HSBC disclosed on Oct. 4 that it was considering selling HSBC Bank Canada, a unit that analysts estimate to be valued around C$8 billion ($5.88 billion) to C$10 billion ($7.35 billion).

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The Globe and Mail, in its report on Friday, quoted sources familiar with the process as saying that the field of contenders to acquire HSBC Bank Canada from the British lender was narrowing. Lawyers and analysts have said Canada’s concentrated banking market could discourage big domestic banks from bidding as the government has charged the antitrust regulator to push for more competition.

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The Global and Mail reported that when CIBC CEO Victor Dodig was asked about the HSBC sale at a meeting of senior staff on Thursday, he hinted that preserving capital was important in the current climate of market uncertainty and that the bank’s priority remained organic growth.

HSBC Bank Canada includes four divisions covering HSBC’s commercial banking, personal banking, investment banking and markets services business in the country.

National Bank of Canada declined to comment on the Global and Mail report. HSBC, CIBC and BMO did not immediately respond to requests for comment.

($1 = 1.3600 Canadian dollars)

(Reporting by Jahnavi Nidumolo in Bengaluru; Editing by Will Dunham)



financialpost.com