RBS Asset Sales Pick Up Pace; India, Chile Likely Next-Source

21st Jun 2010 11:29

By Patricia Kowsmann Of DOW JONES NEWSWIRES LONDON (Dow Jones)--Royal Bank of Scotland Group PLC (RBS) will likely announce two more asset sales in the next weeks, as the 83%-government owned U.K. bank tries to speed up non-core divestments this year. The sale of the bank's Indian retail and commercial business to HSBC Holdings PLC (HBC) could close as early as next month, while it will likely seal the sale of its investment banking business in Chile in the next weeks, a person familiar with the situation said Monday. Last week, the bank said it closed the divestments of its retail operations in Kazakhstan, the UAE and Pakistan. It also agreed to sell its Argentina business to a local bank. RBS will keep its presence in Mexico and Brazil, it said. All the operations being sold--which were inherited from the acquisition of a portion of Dutch bank ABN Amro Holding NV in late 2007--have been dubbed non-core by the bank after the financial crisis hit. RBS is trying to finish divestments of the operations in 2010, when it is still expecting to post a full-year loss. It has said it should turn profitable again next year. The bank has been holding talks with HSBC on the Indian assets since last year, but discussions with regulators have held off a final deal. HSBC was also in talks to buy RBS' retail and commercial assets in China and Malaysia, according to people familiar with the situation, but both businesses could now be just run down by the bank instead. RBS expanded aggressively under former Chief Executive Officer Fred Goodwin. It paid GBP10 billion for its part of ABN Amro, which included the Asian businesses and wholesale-banking operations in Europe. The bank is retaining its investment-banking operations and corporate-banking business in Asia. -By Patricia Kowsmann, Dow Jones Newswires. Tel +44(0)207-842-9295, [email protected] (END) Dow Jones Newswires June 21, 2010 06:29 ET (10:29 GMT)