Adios Argentina: HSBC Divests Banking Operations In Argentina For $550M
Portfolio Pulse from Lekha Gupta
HSBC Holdings plc (NYSE:HSBC) is selling its Argentina operations to Grupo Financiero Galicia (NASDAQ:GGAL) for $550M, including banking, asset management, and insurance sectors. The deal involves cash, loan notes, and Galicia's ADRs, with ADRs representing less than a 10% economic interest in Galicia. HSBC anticipates a $1.0 billion pre-tax loss from this sale in Q1 2024 but maintains its dividend payout ratio target and return on equity expectations for 2024. The transaction is expected to close within 12 months, pending regulatory approvals.
April 09, 2024 | 12:43 pm
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NEGATIVE IMPACT
HSBC is divesting its Argentina operations to Grupo Financiero Galicia for $550M, expecting a $1.0 billion pre-tax loss in Q1 2024 but maintaining its 2024 financial targets.
The sale of HSBC's Argentina operations and the anticipated $1.0 billion pre-tax loss could negatively impact investor sentiment in the short term, despite the maintenance of its 2024 financial targets.
CONFIDENCE 90
IMPORTANCE 90
RELEVANCE 100
NEUTRAL IMPACT
Investors can gain exposure to HSBC stock via Avantis International Large Cap Value ETF (NYSE:AVIV).
While the ETF provides exposure to HSBC, the direct impact of HSBC's Argentina operations sale on the ETF's performance is less clear, suggesting a neutral short-term impact.
CONFIDENCE 75
IMPORTANCE 50
RELEVANCE 50
NEUTRAL IMPACT
Investors can gain exposure to HSBC stock via Themes Global Systemically Important Banks ETF (NASDAQ:GSIB).
While the ETF provides exposure to HSBC, the direct impact of HSBC's Argentina operations sale on the ETF's performance is less clear, suggesting a neutral short-term impact.
CONFIDENCE 75
IMPORTANCE 50
RELEVANCE 50
POSITIVE IMPACT
Grupo Financiero Galicia is acquiring HSBC's Argentina operations for $550M, involving a mix of cash, loan notes, and ADRs, representing less than a 10% economic interest in Galicia.
The acquisition of HSBC's Argentina operations could be seen as a strategic expansion for Grupo Financiero Galicia, potentially positive for its stock in the short term.
CONFIDENCE 85
IMPORTANCE 85
RELEVANCE 90