HSBC May Sell 98.94% Stake in Indonesia’s PT Bank Ekonomi

HSBC Holdings Plc (HSBA), Europe’s largest bank, is reviewing its 98.94 percent stake in PT Bank Ekonomi Raharja, an Indonesian lender focused on small- and medium-sized enterprises, after a four-year investment.

“HSBC remains committed to investing and growing in Indonesia,” Peter Wong, chief executive officer for Asia Pacific at the lender, said in a statement to the London Stock Exchange yesterday. “Should the strategic review result in a disposal, the proceeds would be reinvested in Indonesia, a priority market for the HSBC Group.”

HSBC is focusing on reducing costs, selling assets and expanding in faster-growing markets as the lender struggles to boost revenue that’s been crimped by the sovereign debt crisis in Europe. Chief Executive Officer Stuart Gulliver has announced plans to sell or close 52 businesses by the end of the first quarter since he assumed the position in 2011.

HSBC, which got 87 percent of its pretax profit in Asia last year, has a presence in at least 22 countries and territories in the region, according to its latest annual report. Australia, China, India, Indonesia, Malaysia, Singapore, Taiwan and Vietnam are the key Asian markets where HSBC focuses, according to investor day presentation material from May 15.

HSBC in 2008 agreed to buy 88.9 percent of Bank Ekonomi for $607.5 million in cash, it said in a statement to the London Stock Exchange on Oct. 20 that year.

To contact the reporter on this story: Stephanie Tong in Hong Kong at stong17@bloomberg.net

To contact the editor responsible for this story: Chitra Somayaji at csomayaji@bloomberg.net

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