HSBC is planning to withdraw from the U.S. mass-market retail banking by liquidating some parts of its business.
The company said Thursday it will be winding down its U.S. operations as part of its long-planned move to shift its focus on Asia, its largest market.
The plan to sell parts of its U.S. operations is part of a massive restructuring strategy aimed at cutting the company's losses. Over the past few years, HSBC has been trying to reduce its presence in some European and North American markets where it has been struggling to hit its targets.
HSBC - Europe's largest bank - has seen its earnings dwindle over the past few years due to increased competition from larger domestic players. The bank said Thursday that it would be exiting the U.S. retail banking sector for individual and small business customers.
"They are good businesses, but we lacked the scale to compete," HSBC's chief, Noel Quinn said.
Citizens Bank said in a statement that it had agreed to buy HSBC's east coast personal and small business banking business - including 80 of its branches. In a separate statement, Cathay Bank said it has agreed to buy HSBC's west coast business - including 10 of its branches.
Citizens Bank and Cathay Bank did not disclose how much they paid for HSBC's businesses. However, HSBC did say that it expects to incur a pre-tax cost of around $100 million related to the transactions.
HSBC said it will retain some small physical presence in North America to serve its international clients. The bank previously said it is exploring "organic and inorganic options" for its U.S. retail banking business.
Quinn said in the company's latest earnings call that he plans to continue to slash costs across the banking group. He also said the bank will be redoubling its efforts to grow its business in profitable markets such as the UK and Asia and scale back from sub-scale markets.
In March, HSBC said it has entered final negotiations to sell its French retail banking business to private equity company Cerberus.
