Nations Trust Bank PLC (NTB) has entered into a landmark agreement to acquire the retail banking operations of HSBC Sri Lanka, in a deal valued at LKR 18 billion plus applicable taxes. The binding Sale and Purchase Agreement was signed on September 24, 2025, and is expected to be completed in the first half of 2026, subject to regulatory approval.
The transaction covers approximately 200,000 customer accounts, including credit cards, personal loans, and HSBC’s Premier banking clientele. NTB has also pledged to offer employment to existing HSBC retail banking staff to ensure a smooth transition.
HSBC’s exit applies only to its retail segment; the bank will continue to operate its corporate and institutional banking business in Sri Lanka. The divestment comes amid HSBC’s global “simplification” strategy announced in October 2024, under which the bank is shedding non-strategic, small-scale retail operations in several markets.
Standard Chartered is also reviewing plans to exit its Wealth and Retail Banking arm in Sri Lanka, reflecting a broader global trend among international banks to streamline operations. Rising compliance costs, currency volatility, inflation, and regulatory pressures in emerging markets like Sri Lanka have made retail banking less attractive for global lenders compared to their more profitable corporate, institutional, and wealth management businesses.
Sri Lanka’s recent economic turmoil—including the 2022 sovereign default, inflation spikes, and foreign exchange shortages—has further heightened risks in the retail banking sector, prompting international banks to reassess their exposure.
For NTB, the acquisition marks a significant growth opportunity, particularly in the high-value premier segment. The deal is expected to strengthen NTB’s market position, broaden its customer base, and create cross-selling opportunities. The bank has stated that the purchase will be funded through internally generated resources, while maintaining regulatory capital ratios.
Industry observers note that the move signals a shift in Sri Lanka’s banking landscape, with local players increasingly consolidating retail banking as global banks scale back. While HSBC and other foreign lenders remain active in corporate and institutional segments, domestic banks are emerging as the dominant force in the retail space.
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