Mike Clarke/Agence France-Presse — Getty ImagesPeter Ma, chief of Ping An Insurance of China.HONG KONG – HSBC Holdings said on Monday that it was in talks about selling its stake in Ping An Insurance of China, which could be worth more than $9 billion.
Like rivals, HSBC has been rethinking its portfolio.
With the sovereign debt crisis dragging on and the economy slumping, the British bank has been moving to shed assets and streamline its global operations in a bid to increase profitability. Since Stuart T. Gulliver took over as chief executive at the beginning of 2011, the bank has sold more than 40 noncore assets, worth roughly $4 billion.
HSBC, based in London, made its initial investment in Ping An in 2002, when the bank’s insurance arm paid $600 million for a 10 percent stake. The valuation of that initial stake has since risen ninefold, and HSBC has added to it.
Ping An, one of the largest insurers in China, has expanded its operations to include banking and asset management. HSBC owns 40 percent of Ping An’s Hong Kong-traded shares, or so-called H-shares, representing a 15.6 percent stake in the overall company. At that level, HSBC’s stake would be worth $9.3 billion.
“HSBC has from time to time received approaches regarding its shareholding and confirms that it is in discussions which may or may not lead to the sale of the shares,” the bank said Monday in a Hong Kong stock exchange announcement. It did not identify the potential bidder or bidders.
Shares in Ping An fell sharply on Monday on the news that HSBC might sell its stake. The stock dropped 3.4 percent at one point before recovering to close down 1.9 percent at 58.45 dollars.
In addition to Ping An, HSBC has substantial stakes in the Bank of Communications, one of the largest banks in China, and in a midtier institution, Industrial Bank, which is based in Fujian Province.