Core Viewpoint - HSBC Holdings Plc's subsidiary, HSBC Continental Europe, has agreed to sell its custody operations in Germany to BNP Paribas as part of its simplification strategy to focus on being a leading corporate and institutional bank in Germany and Europe for international clients [1][10] Group 1: Details of the Transaction - The custody business in Germany provides domestic custody, clearing, and depository services for German institutional clients [2] - The financial terms of the agreement are undisclosed, but it involves the complete transfer of custody operations, including all assets and related clients, to BNP Paribas, with a phased execution starting in early 2026 [3][4] - The completion of the transaction is subject to regulatory and antitrust approvals, as well as negotiations with the Works Council in Germany [4] Group 2: Strategic Alignment - The divestiture aligns with HSBC's simplification strategy announced in October 2024, which includes winding down investment banking activities in the UK, Europe, and the US, and divesting from its French life insurance arm and private banking business in Germany [5] - HSBC has also sold its business in South Africa and completed sales in various countries including the US, Canada, and New Zealand in recent years [6][7] Group 3: Financial Impact - HSBC aims to achieve $1.5 billion in annualized savings by the end of 2026 through these divestitures and cost realignment efforts, with expected upfront charges of nearly $1.8 billion [8] - The bank plans to reallocate an additional nearly $1.5 billion of costs from non-strategic activities to priority growth areas over the medium term [8] Group 4: Market Performance - Over the past year, HSBC shares have increased by 38.2%, outperforming the industry's growth of 32.2% [9]

Press Release 27 June 2025 SALE OF CUSTODY BUSINESS IN HSBC GERMANY HSBC Continental Europe has reached an agreement to sell its custody business in Germany to BNP Paribas S.A, Niederlassung Deutschland (‘BNP Paribas’) (the ‘Potential Transaction’), reinforcing its focus on being the leading corporate and institutional bank in Germany and Europe for international clients. This decision forms part of the simplification strategy of HSBC announced in October 2024. HSBC is focused on increasing its leadership a ...