NAB to close HK operations in 2025; Westpac updates institutional banking priorities

NAB says it will serve corporate and business clients from other regional branches, while Westpac has announced plans to ‘uplift’ its transactional banking.

Nell Hutton, will start her role as Westpac’s institutional bank head on October 1. Picture: Britta Campion

NAB will close its Hong Kong operations in the first half of 2025, as part of a restructuring of its markets business and a reshaping of its regional strategy.

The bank will no longer have a physical presence in Hong Kong but will continue to serve its clients from other regional branches, it said on Thursday.

Krista Baetens, who led NAB’s Asian business since 2021 and last month was named markets executive on the bank’s corporate and institutional banking (C&IB) unit, said closing the branch had been a “difficult decision” which was “not taken lightly”.

NAB is restructuring parts to its operations to cut costs. Last month it moved to shed about 10 per cent of staff from its markets team and cut another 220 back-office jobs.

The move follows its rival Westpac’s 2020 decision to close its Hong Kong, Shanghai and Beijing branches and service clients from its Singapore business hub.

While Australian banks have retail and institutional banking operations domestically, their international businesses primarily service businesses and large corporate clients. Neither Commonwealth Bank nor ANZ have shown any indication they would downsize their Hong Kong operations.

NAB’s decision followed a thorough strategy assessment and “reflects our ambition to align our Corporate & Institutional business with the greatest opportunities for NAB and our clients,” Ms Baetens said in a statement.

The decision will impact about 50 bankers servicing clients around its markets, product distribution and trade finance businesses. A small number of bankers will be impacted, but most of the roles will be treasury, finance, risk and legal positions, with some of the staff expected to be relocated to other roles and regions.

“We anticipate the wind down of our operations in Hong Kong will take approximately 18 months,” Ms Baetens said.

“NAB remains committed to Asia and our branches in Singapore, Tokyo and Shanghai are our key customer outreach hubs in the region. Our priority is to work closely with colleagues and clients to support them through the transition.”

Separately, on Thursday, Westpac held an investor briefing to communicate the strategy of its institutional banking unit under incoming head Nell Hutton, following a management reshuffle announced in July.

The bank stressed its international operations were efficiently managed around five large hubs: New York, London, Singapore, and its recently opened offices in Frankfurt.

Ms Hutton, currently the managing director for financial markets, takes over from Anthony Miller on October 1, while he becomes the head of the reinstated business banking division.

The bank said its key priority in that unit was to “uplift” its cash management and transactional banking technology, which had lagged peers such as its smaller rival ANZ, which is seen as the leader in that area.

It will build a cloud-based corporate cash management platform that will be integrated into a new “intuitive digital platform for relationship managed customers” called Westpac One.

“Westpac One will provide personalised access to real time liquidity and payment solutions, lending, deposit and risk management tools digitised on boarding and data-driven insights,” Ms Hutton said.

The transaction banking platform will be called Westpac Core and will allow for “lightning fast, predictable and reliable, and reliable payments and control of cash positions,” she added.

Despite repeated requests from analysts and investors, the bank executives did not say how much the bank would spend on the initiative, in which it said it started working in October last year.

She also said the bank was using AI technology to test a new tool for its market dealers designed to answer their questions, “quickly, completely and accurately on the go, by scraping data from over 100 Westpac documents,’ she said.

The tool will be live tested in coming weeks, she added.