HSBC Offloads $36B Australian Loan Book
Synopsis
Blackstone will acquire HSBC's Australian lending portfolio, while Pepper Money takes over loan servicing.
HSBC Sells AUD 36 Billion Australian Home and Personal Lending Business as planned exit of retail banking operations. It is set to sell its Australian home and personal lending portfolio to funds managed by Blackstone.
The portfolio consists of some AUD $36 billion (US$25.3 billion) in home and personal loans, which are to be transferred to the first half of 2027 upon regulatory approval.
The transaction will likely be one of the largest ever single-sale residential mortgage portfolio transfers in the world. All existing customers will retain their existing agreements with HSBC throughout the transition process and Pepper Money will service the loan portfolio post-closing.
HSBC Narrows Focus on Institutional Banking
The sale is part of an ongoing global restructuring by HSBC that aims to increase returns and scale for the bank in areas that will benefit from a greater scale of operations and potentially offer higher returns.
It is being supported by an ongoing plan to wind down HSBC's retail operations in Australia over the coming 18 months; this includes all transaction accounts, savings accounts, term deposits and credit cards in the country.
The other lines of business HSBC will be continuing to run from Australia include Corporate and Institutional Banking, Global Private Banking and Asset Management; HSBC will communicate more information to customers about specific products to ensure all accounts are transferred or closed as necessary in the future.
HSBC will notify customers at the relevant time about the steps they need to take to migrate services.
HSBC generated a profit before tax in 2025 of US$29.9 billion and had Common Equity Tier 1 (CET1) capital ratio of 14.9% in 2025 - a key indicator of the bank's financial health.
It is expected that this transaction will generate a loss under US$100 million for the bank, and include foreign exchange translation and restructuring costs, but will have no material impact on the lender's capital base.
Deal Adds to Blackstone's Credit Portfolio
The purchase adds to Blackstone's credit business and has broadened the company's access to the Australian home and personal lending market, an area institutional investors are increasingly seeing opportunities to fund private credit in recent years. Blackstone manages in excess of US$1.2 trillion globally and its credit division is one of the bank's core operations.
The size of the Australian home and personal lending market is also highlighted by this deal. In 2026 there were in excess of AUD $2.5 trillion in residential housing loans across authorised deposit taking institutions (ADIs) in Australia, as stated by APRA's website.
Australia has one of the most consolidated housing loan markets in the GFC world, with approximately 80% of housing loans in Australia dominated by one of the big four Australian banks.
This is a part of a number of broader strategic moves HSBC has been making throughout its global presence since 2016 as the bank realigns the business to new International operations of global investment opportunities. In future retail banking services will cease, but the group will continue its commitment to all of its corporate, multi-national and institutional customers and wealth customers across Australia.
Source: Capital Brief
Pooja Malik is a business journalist with over six years of experience covering startups, entrepreneurship, and emerging trends. She has previously worked with leading media platforms such as YourStory Media and BW BusinessWorld, where she reported on business, policy, and market developments. Currently, she serves as Editor at The Inspirepreneur Magazine, where she writes and edits stories across business, lifestyle, and travel, with a focus on clarity, accuracy, and reader relevance.
