HSBC sells UK life insurance arm in latest European retreat
Banking juggernaut HSBC has marked its latest retreat on European operations after selling its UK life protection arm to insurance firm Chesnara.
HSBC have offloaded the division for £260m, which Chesnara will fund through a combination of external resources, credit facility and a equity raise.
The move comes amid Georges Elhedery‘s sweeping changes at the lender, since taking the helm last year.
Elhedery plotted a “simpler, more dynamic and agile organisation” in his overhaul first announced in October 2024. A staple of these plans included splitting the business “eastern markets” covering the Asia-pacific and the Middle East and “western” with the Americas and Europe.
But the sale of its UK insurance arm marks the latest manoeuvre pointing to a withdrawal from European operations.
This followed the bank chopping 348 positions in France, representing approximately 10 per cent of its work force in the country and selling its retail banking business in France to CCF – a subsidiary of My Money Group.
Instead, Elhedery has eyed growth prospects in Asia, where he praised performance in his letter to shareholders included in the bank’s annual report. HSBC reported a $75bn increase in customer accounts, on a constant currency basis, and cited growth “primarily in Asia”.
Chesnara eyes FTSE 250
Chesnara is set to bolster its operations on the back of an acquisition. HSBC Life maintained funds of £314m as of December 31 2024.
The firm said on Thursday it expects eligibility for FTSE 250 inclusion after increasing liquidity. The deal is set to create cash generation in excess of £800m for Chesnara, with £140m during the first five years post-acquisition.
The company also anticipates an increase in full-year and interim 2026 dividend by an adjusted six per cent.
Steve Murray, chief executive, said: “The proposed acquisition of HSBC Life (UK) represents a material step up in scale for Chesnara Group.
“This highly accretive transaction will allow us to build on our strong, 20-year track record of uninterrupted dividend growth.”