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Customers enter a branch of HSBC in Hong Kong. (ANTONY DICKSON/AFP/Getty Images/ANTONY DICKSON/AFP/Getty Images)
Customers enter a branch of HSBC in Hong Kong. (ANTONY DICKSON/AFP/Getty Images/ANTONY DICKSON/AFP/Getty Images)

HSBC confirms talks to sell Canadian brokerage Add to ...

As HSBC Holdings PLC looks to shed costs from its global operations, the bank acknowledged it is in talks to sell part of its Canadian operations, but said a deal has not yet been reached.

After reports two weeks ago that the U.K.-based bank had opened the books on its Canadian retail brokerage to potential bidders, HSBC issued a statement Tuesday confirming the process. However, “no decision has yet been made to proceed with any transaction,” the bank said.

The bank is looking to sell the investment advisory division of its retail brokerage business. HSBC’s Canadian subsidiary has 8,000 employees, about $30-billion of assets under administration and more than 140 bank branches across Canada.

The bank, which operates in more than 80 countries, has been trimming its global operations in an effort to shore up its balance sheet. HSBC announced this summer that it will lay off 30,000 people worldwide by 2013 and has been shedding assets, including its U.S. credit card unit.

The Canadian sale comes after the bank’s recently-appointed chief executive, Stuart Gulliver, said in July that the Canadian operations would not be affected by the cost cutting. However, ongoing volatility in the global banking sector, including economic uncertainty in Europe, has led HSBC to take further steps to bolster its balance sheet. The bank plans to focus more on emerging markets such as Asia.

HSBC Holdings manages $2.7-trillion (U.S.) of assets and is one of the world’s largest financial institutions. Though no potential buyers for the Canadian assets have been named, National Bank Financial is believed to be looking at the assets.

Quebec-based National Bank is looking to expand in Western Canada and most of HSBC's wealth management money is located on the west coast. National bought Wellington West Holdings Inc. of Winnipeg this year to expand its wealth management capacity across the country.

“We are in a position to look at other deals,” National Bank chief executive officer Louis Vachon told analysts during the bank’s third-quarter conference call at the end of August.

National Bank has also shuffled management to pursue more acquisitions. As part of the move, chief financial officer Patricia Curadeau-Grou has been named executive vice-president of risk management and will serve as a strategic adviser to the CEO. One of Ms. Curadeau-Grou’s main priorities will be to assess potential asset purchases, the bank said.

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