Galicia to Acquire HSBC’s Argentina Business for $550 million


Galicia to Acquire HSBC’s Argentina Business for $550 million

HSBC Holdings announced on Tuesday that they have agreed to sell their Argentina business to Grupo Financiero Galicia, the largest private financial group in the country, for $550 million. The sale was made by HSBC Latin America B.V., a unit of HSBC, with limited connectivity to the international network of the bank.

According to HSBC, the Argentina business is primarily focused on domestic operations and does not have significant connections to their global network. The size of the business also causes earnings to fluctuate dramatically when translated into US dollars. Grupo Financiero Galicia, based in Buenos Aires, is the fifth largest bank in Argentina.

The divestment of the Argentina business is expected to result in a pre-tax loss of $1 billion for HSBC in the first quarter of fiscal 2024. This move is part of HSBC’s strategy to streamline its operations and focus on key markets. The sale to Grupo Financiero Galicia will allow HSBC to exit a market where it has limited presence and reduce earnings volatility.

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