HSBC, through its wholly owned subsidiary HSBC Bank USA, is
selling 195 retail branches, primarily in Upstate New York, to First Niagara
Bank for $1 billion, a sum equal to a premium of 6.67 per cent of the deposits
to be transferred on closing when based on 31 May figures.

The move is part of “its ongoing US strategic focus on commercial
and corporate banking”. The UK/Hong Kong-listed banking group said HSBC Bank USA “remains
committed to serving and further developing corporate banking relationships in
Upstate New York”.

 In particular, the
bank will continue to provide a full suite of international commercial banking
offerings, including trade and cash management products and services through
its four business centres in the region.

 The all-cash
transaction is expected to close in early 2012, subject to regulatory approvals
and other customary closing conditions.

 HSBC’s statement made
no reference to private banking and wealth management services.

As at 31 May, the 195 branches held approximately $15.0 billion
in deposits, $15.0 billion in gross assets including $2.8 billion in loans, and
held $4.3 billion in assets under management.

"HSBC is committed to the US and leveraging our international
network and skill-set, which are our competitive advantages. This transaction
is part of the strategy outlined in our May 2011 Investor Day presentation to
align our US business with our global network and meet the local and
international needs of domestic and overseas clients," said Niall Booker,
group managing director and chief executive of HSBC North America.

In addition to the sale of the retail branches to First
Niagara, HSBC Bank USA has decided to consolidate approximately 13 branches
located in Connecticut and New Jersey into nearby HSBC branches by the first
quarter of 2012, subject to regulatory approval, HSBC said in a statement.

Over the weekend, media reports said that HSBC was likely to
axe at least 10,000 jobs in the coming year, with the vast majority coming
"outside the UK”.
As of the time of going to press, however, no such announcement had been
released.