OCBC outbid competitors by more than US$100 million to secure the retail and wealth assets of HSBC in Indonesia, according to people familiar with the matter, as reported by Bloomberg.
The aggressive offer allowed the Singaporean bank to enter bilateral negotiations and finalise the agreement earlier this month.
The wide bidding gap highlights the bank’s determination to capture a larger share of the local market.
As OCBC acquires HSBC Indonesia retail and wealth operations, it brings a S$6.6 billion portfolio into its regional business.
This portfolio comprises S$2.3 billion in deposits and a S$300 million retail loan book.
Accelerating wealth expansion in Indonesia
The acquisition aligns with the strategic priorities of new Chief Executive Officer Tan Teck Long, who is driving a broader push into the Asian wealth sector.
Tan previously described the HSBC portfolio as a perfect fit for the bank’s strategy in Southeast Asia’s largest economy.
OCBC calculated the transaction price based on the net asset value of the International Wealth and Premier Banking operations, alongside a premium of up to S$480 million.
The bank expects to complete the deal in the first half of next year pending regulatory approvals.
OCBC also committed to employing all 1,300 staff currently working within the HSBC Indonesia retail banking operations.
OCBC already operates in the country through its Jakarta-listed subsidiary Bank OCBC NISP Tbk.
The bank has grown its local footprint organically and through acquisitions, including buying the local unit of Commonwealth Bank of Australia in 2024.
Outpacing regional competitors
The auction for the HSBC portfolio attracted bids from several major banks.
Shortlisted competitors included DBS, UOB, Malaysia’s CIMB and Japan’s Sumitomo Mitsui Financial Group.
OCBC stated that it reached the final amount on a willing buyer and willing seller basis, factoring in business prospects and future synergies.
Analysts view the transaction as a positive step for OCBC. The acquisition will boost the bank’s regional franchise while strengthening profit margins and fee income.
Featured image credit: Edited by Fintech News Indonesia, based on image by HSBC
