HSBC is planning to acquire the retail and small and medium enterprises business of RBS in India, China and Malaysia, reported Livemint.com. Reportedly, the London-based HSBC has entered into the bidding fray after negotiations between Standard Chartered Bank and RBS failed due to differences on the valuation of assets.

Both the banks are already said to have struck a deal and the acquisition is going to depend on the regulatory approvals in the three nations, reported the web site citing an RBS official in India. Reportedly, RBS has approached RBI, the Indian financial regulator, for clearance of transfer of its branch licences to HSBC.

Vasantha Kumar, head of marketing and communications at ABN Amro Bank, said: “RBS is in ongoing discussions for the remaining retail and small and medium enterprises assets it has decided to sell in Asia and will make further announcements, as appropriate, in due course.”

Madan Menon, country head of global banking and markets at ABN Amro Bank, said: “Post the sale, the RBS group in India will focus on its core business—corporate banking, markets and treasury, equity capital markets, merger and acquisitions, syndicated loans, debt capital markets, trade finance and cash payments… For the retail and SME (small and medium enterprises) businesses, India will be the third largest employer within the RBS group in the world.”

“The entire deal rests on the transfer of branches and it depends on what stance RBI takes. The quality of the consumer banking assets is bad hence the only attraction for HSBC is the branch network that it could acquire through this deal. RBS is trying to convince the Indian banking regulator to transfer some branch licences to the prospective buyers so that its existing clients receive uninterrupted service,” reported the web site citing an investment banker associated with the deal.