LONDON — HSBC, Europe’s biggest bank, has announced the sale of its Armenian subsidiary which will end its nearly 30-year presence in Armenia.
In a statement issued late on Tuesday, the British bank said it has agreed to sell the HSBC Armenia unit to the country’s leading bank, Ardshinbank, in line with its “strategy to redeploy capital from less strategic or low-connectivity businesses into higher-growth opportunities globally.”
Ardshinbank confirmed the agreement in a separate statement. Neither side disclosed the terms of the deal subject to regulatory approvals.
“Ardshinbank looks forward to welcoming HSBC Armenia customers onto our award-winning platform and to further delivering on its strategy to accelerate growth and expand product offering for clients,” said the bank’s chairman, Artak Ananian. He promised a “smooth and fluid transition” for the 30,000 or so customers.
Reuters reported last May that HSBC is considering a possible exit from as many as a dozen countries after earlier announcements about selling off parts or all of its activities in France, Canada, Russia and Greece. HSBC completed the sale of its French retail business to CCF on January 1 days after Canada approved the acquisition of the bank’s Canadian business by Royal Bank of Canada.
Established in 1996, HSBC Armenia is the only local commercial bank controlled by a major Western banking group. It currently has total assets worth 290 billion drams ($720 million) and around 200 billion drams in customer deposits.
HSBC Armenia’s net profit rose from 8 billion drams in 2022 to over 11 billion drams ($27 million) last year. By comparison, Ardshinbank reported nearly 63 billion drams in earnings in 2023.
The 18 banks operating in Armenia nearly tripled their combined profits, to a record 253 billion drams, in 2022 amid a dramatic increase in cash flows from Russia which followed the Russian invasion of Ukraine. The figure fell by 9 percent in 2023, according to the Hetq.am publication.