HSBC has announced plans to sell its retail banking and wealth management business in Thailand to Bank of Ayudhya, the latest in a series of fire sales as the bank seeks to reduce costs.

HSBC has announced plans to sell its retail banking and wealth management business in Thailand to Bank of Ayudhya, the latest in a series of fire sales as the bank seeks to scale back costs.

The Asia-focussed firm said in a statement that the value of the unit was approximately THB17.5bn ($553m) at 31 December 2011. The bank could not confirm how many jobs would be affected but a spokesperson said: 

"Bank Ayudhya has committed to offer positions to qualified employees. We have been in Thailand since 1888 and Thailand remains an important market for HSBC's commercial banking and global banking and markets businesses."

The sale, which is subject to regulatory and shareholder approvals, is expected to complete during the first half of 2012.

“The transaction represents further progress in the execution of HSBC’s strategy outlined at the Investor Day in May 2011,” said the firm in a statement, referring to the radical cost-cutting measures announced last year which include plans to save up to $3.5 billion by 2013, partly through axing 30,000 global jobs. 

HSBC chief executive Stuart Gulliver said he wants to sharpen the bank's focus in Asia by exiting regions where it has a smaller presence, as part of a restructuring strategy to weather the difficult economic climate. HSBC reported a 36 per cent fall in profits during the third quarter of last year, dragged down by its investment bank which was impacted by the Eurozone debt crisis and volatile markets.

HSBC has since said it will exit 14 countries or businesses, including selling its US credit card business, retail businesses in Russia and Poland and its Canadian brokerage businesses. 

The London-listed bank last month offloaded its private banking business in Japan to Zurich-based rival Credit Suisse for around 200 million yen ($2.57 million). 

Meanwhile HSBC Asia subsidiary Dar Es Salaam Investment Bank, last year sold its 20 per cent stake in Iraqi insurer Dar Es Salaam Insurance to Gulf Insurance for approximately $1.3 million. It also recently sold its operations in Costa Rica, El Salvador and Honduras as part of its restructuring strategy.

The pocket of wealth in Thailand is small compared to that in Japan and China, which rank first and second respectively as the Asian countries with the highest ultra high net worth populations. Thailand ranks ninth, with a UHNW population of 600 who have an aggregate wealth of $95 billion, according to intelligence firm Wealth-X.