HSBC Holdings Plc said it would stop selling Shariah-compliant products in the U.K., the UAE, Bahrain, Bangladesh, Singapore and Mauritius.
The bank will continue offering wholesale Islamic financing in those countries, and the change is part of the company’s review into its businesses, it said in an e-mailed statement today.
HSBC was facing local competition in the businesses it chose to exit, which represented 17 percent of the bank’s Islamic business revenue, Patrick Humphris, HSBC spokesman, told Bloomberg in a phone interview from London today.
“These are smaller markets where we do not have sufficient scale,” he said. “We did face tough competition. Clearly there will be a number of other providers of Islamic banking products in those markets, and it’s about having enough scale so that this business is economic and makes the right return.”
The bank said in its statement it would focus its Islamic finance offering in Malaysia, Saudi Arabia, and Indonesia. It will also continue to offer Islamic bonds or sukuk products through its operations in Malaysia and Saudi Arabia.
HSBC is the world’s biggest sukuk underwriter, leading the league table ahead of Malayan Banking Bhd. and CIMB Group Holdings Bhd. after handling 78 sales valued at $10 billion.