HSBC Holdings Plc, the European bank seeks buyers for its non-life insurance assets, will consider selling regional units of the business separately, Bloomberg reported, citing three people familiar with the matter.
HSBC may receive offers for its general insurance operations in Asian and Latin America separately, though potential buyers can also submit bids for the global business.
The sale may value HSBC’s non-life insurance assets at $1.5 billion, they said, asking not to be identified because the sale process is private.
Selling the regional operations separately may help HSBC get a higher price for the assets, as some buyers are only interested in acquisitions in Asia and Latin America, the people said.
MS&AD Insurance Group Holdings Inc and Axa SA are among the possible bidders for HSBC’s non-life insurance business.
Gareth Hewett, a spokesman for HSBC in Hong Kong, declined to comment on the sale process. The spokespeople for MS&AD, Japan’s biggest non-life insurer, and Axa, Europe’s second largest insurer.
HSBC, Europe’s largest bank, reported $1.3 billion of gross premiums for its non-life insurance business last year, accounting for about 11% of total insurance premiums, according to its annual report.
The non-life insurance operations in Asia brought in about $700 million of premiums in 2010. The bank in July agreed to sell almost half of its US branches to First Niagara Financial Group Inc for about $1 billion.
HSBC said last month it will reap a $2.4 billion after-tax gain from the sale of its US credit card division to Capital One Financial Corp.
The company has also sold part of its Russian consumer banking unit and said it will shut 10 retail branches in Poland.
The European lenders will need to raise an extra 423 billion euros ($611 billion) by 2019 to comply with global capital rules approved by the Basel Committee on banking supervision, according to a European Union study.
HSBC is slashing jobs and closing offices to cut costs by as much as $3.5 billion over the next two years as it prepares for the stricter regulations.
The Basel committee said in July that 28 banks would be subject to additional capital requirements to rein in too big to fail lenders.
HSBC Holdings Plc is a global banking and financial services company headquartered in Canary Wharf, London in United Kingdom.
