HSBC has announced it will sell its entire Sri Lankan retail banking business to Nations Trust Bank, as part of a global strategy to scale back less-profitable operations.
The deal, disclosed this week, will see Nations Trust acquire all of HSBC’s Sri Lanka retail accounts, credit cards and retail loans. Approximately 200,000 customers are expected to be transferred under the agreement. Nations Trust has also pledged to “make an offer of employment to all staff” working within HSBC’s Sri Lanka retail business.
No financial details of the transaction have been made public. The sale is subject to regulatory approval and is expected to be completed in the first half of 2026. HSBC stated that the move would have no material impact on its profit gain.
The British lender stressed that the sale would not affect its corporate and institutional banking business in Sri Lanka, which will continue operations as usual.
HSBC’s withdrawal comes as Sri Lanka continues to grapple with the fallout of its worst economic crisis in decades. The island defaulted on its sovereign debt in 2022, plunging the country into shortages of food, fuel and medicine, and forcing the government to seek a US$3 billion bailout from the International Monetary Fund (IMF). The bailout programme remains “knife-edged,” according to IMF officials, with further disbursements tied to contentious austerity measures and structural reforms.
The exit from Sri Lanka’s retail sector is also part of HSBC’s strategic simplification drive launched in October 2024, which aims to focus resources on markets where the bank sees greater opportunities for growth. In July, HSBC shut down its Bangladesh retail banking unit under the same review.
For Sri Lanka, the sale highlights the fragility of its financial sector, as local banks move to absorb the retail footprint of departing global players.