HSBC has agreed to sell its general insurance manufacturing portfolios in Hong Kong, Singapore, Argentina and Mexico to AXA and QBE in separate deals valued at $914 million, coming as the latest in a series of fire sales from the global bank.

French insurer AXA Group and Australian insurer QBE Insurance Group will become the exclusive provider of general insurance products to HSBC’s customers in Hong Kong, Singapore, China, India, Indonesia, Argentina and Mexico, under an exclusive 10-year bancassurance agreement, according to a statement from the firm.

It is the latest in a string of asset sales from the bank. HSBC is beating a retreat from sectors and regions where it lacks scale, as part of its strategy to focus its capital and resources on the growth of its core businesses. The bank’s wide-reaching cost-cutting program and global restructuring will impact around 30,000 jobs, as Gulliver attempts to rein in costs in a difficult trading environment.

The deal will be split between the two firms, with AXA taking HSBC's general insurance portfolios in Hong Kong, Singapore and Mexico.

QBE will buy HSBC Argentina’s general insurance manufacturing subsidiary, HSBC La Buenos Aires Seguros. Meanwhile Hang Seng Bank, a 62 per cent-owned subsidiary of HSBC, has agreed to sell its general insurance manufacturing subsidiary, Hang Seng General Insurance (Hong Kong) to QBE.

The aggregate cash consideration payable by AXA and QBE for the acquisitions is approximately $914 million ($494 million by AXA and $420 million by QBE).

AXA has committed to offer positions to all employees in general insurance in Hong Kong and Singapore. General insurance covers medical, property and casualty and accident and health.

HSBC said there will be no impact to its life insurance and pensions businesses, which it says are core to its strategy to provide a comprehensive range of life and non-life insurance products to retail banking and commercial banking customers.

Long-term strategy

The bank says it will maintain some presence in the sector by “building on our own manufacturing and distribution capabilities in life insurance, pensions and investment products, and strengthening our strategic partnerships with companies that manufacture strong general insurance products for distribution to our customers.”

“This is a further step in the execution of our strategy. It will enable us to focus our capital and resources on the growth of our core businesses, including the building of our broader wealth management capabilities," said Stuart Gulliver, HSBC group chief executive, in a statement.

“These long term collaborations with AXA and QBE will broaden and strengthen the suite of general insurance products available to our retail banking and commercial banking customers in Hong Kong, Mainland China, Singapore, India, Indonesia, Mexico and Argentina," he added.

The bank has been scaling back other parts of its Asia businesses including Japan, South Korea and Thailand. In January it agreed to sell its Japanese private banking arm to Credit Suisse, and also sold its Thai retail unit to Bank of Ayudhya.

HSBC will likewise sell operations in Costa Rica, El Salvador and Honduras to Colombia's Banco Davivienda for $801 million, in order to focus on more lucrative markets in Latin America.