We use cookies to provide you with a better experience. If you continue to use this site, we'll assume you're happy with this. Alternatively, click here to find out how to manage these cookies

hide cookie message
RSS FeedFinancial Planning

Sale of RBS’ Indian unit to HSBC collapses

Banks fail to reach final agreement and data transfer deadline

Article comments

A move by Royal Bank of Scotland (RBS) to sell its Indian commercial and retail banking unit to HSBC has collapsed two years after an initial agreement was reached.

Neither RBS nor HSBC commented on the reasons behind the breakdown of talks when contacted by CFOWorld. However, local media reports in India suggest both banks failed to streamline data transfers and meet necessary local regulatory conditions by Friday's stated deadline.

The initial agreement was reached in July 2010. It is thought that RBS’ Indian unit is profitable with revenues of £42 million for the first nine months of 2012, 31 branches and 400,000 customers.

HSBC was set to pay a premium of up to £60 million over the tangible net asset value (TNAV) of the unit. In a statement, RBS said it would now wind down the Indian business.

"Consistent with RBS' strategic objective to reduce or exit its non-core assets and businesses, it will begin to wind down its retail and commercial banking business in India, whilst meeting all customer obligations," it said.

Earlier this year, the bank was hit by severe IT issues in the UK. Subsequently, its £1.6 billion sale of 316 UK branches to Banco Santander also collapsed after over two years of talks. RBS is 82 percent owned by the UK taxpayers following a Treasury cash injection in the aftermath of the global financial crisis of 2008.



Sale of RBS’ Indian unit to HSBC collapses
Financial Planning

Budget: What business wants

Budget: What business wants

CFOs are keen for the chancellor to avoid any uncertaintymore ..

Co-operative Group posts £2.5bn loss

Annual loss the worst in its 150 year historymore ..

Google sees 19% rise in Q1 revenue

However, company missed analysts' expectation as ad prices slidmore ..

Starbucks to move Europe HQ to UK

Coffee chain says move reflects growing importance of UK marketmore ..

Stay ahead of the curve

CFOs used to low interest rates ignore working capital optimisation at their perilmore ..

Digital streamlining of travel and expense claims [Part II]

Concur shows CFOs how to make life easier when the auditors come knockingmore ..

Send to a friend

Email this article to a friend or colleague:

PLEASE NOTE: Your name is used only to let the recipient know who sent the story, and in case of transmission error. Both your name and the recipient's name and address will not be used for any other purpose.

In Depth
How M&A teams can create value by challenging the CEO

How M&A teams can create value by challenging the CEO

A typical “hold” period of nine to 18 months can generate increased sale value more ..

In Depth
What every company needs to do about big data?

What every company needs to do about big data?

In the first of a three part series, Pat Brans explores just how big 'big data' will get? more ..


* *