HSBC to pull out of Australian retail banking market

London-based company to sell local loan portfolio to Blackstone but will continue private and institutional banking services

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The London-headquartered HSBC is closing all Australian branches over the next 18 months after selling its local mortgage and personal loan portfolio to the global asset giant Blackstone.

The transaction will end HSBC’s decades-long retail presence in Australia, although it will continue to operate private and institutional banking services, the company announced on Friday .

HSBC has 19 Australian branches, which will close in a “phased manner”, a spokesperson told Guardian Australia.

The bank representative said it was too soon to share details about job losses, given that the sale is subject to regulatory approval. The bank would need the majority of its retail banking team during the winding down period, the spokesperson said.

HSBC has 2,000 employees in Australia and first gained a commercial banking licences for the local market in 1986, according to its website.

Blackstone has appointed the lending group Pepper Money to service the loans after the sale is completed, which is expected to occur in the first half of 2027.

Pepper is expected to advertise roles that may be filled by HSBC employees.

HSBC’s non-mortgage retail products – including transaction accounts, savings and term deposits and credit cards – will be phased out.

“The decision to sell the portfolio and wind down the remainder of the retail business follows a strategic review of HSBC Australia’s retail business and forms part of the ongoing simplification of the HSBC group,” the bank said.

On Friday, customers received emails saying they would receive “dedicated communications in the coming weeks” about the changes.

HSBC’s consumer business has about $36bn of loans, mainly consisted of mortgages.

Overseas banks have historically found it challenging to establish a profitable foothold in Australia’s $2.5tn mortgage market, given the entrenched dominance of Australia’s big four retail banks, as well as Macquarie.

Australia’s five biggest lenders control about 80% of the mortgage market, according to regulatory data.

Several overseas banks, including the New York-headquartered Citi, have previously exited the Australian mortgage market.

The Finance Sector Union’s national secretary, Julia Angrisano, said the impending branch closures represented “another nail in the coffin of in-person banking in this country”. Angrisano urged “Blackstone to consider keeping some branches open for the sake of their customers.”