Merrill wants out of HSBC web deal

12 April 2012

US investment bank Merrill Lynch is reportedly in talks with banking group HSBC to wind down its involvement in their £700m online venture aimed at wealthy customers.

MLHSBC has attracted fewer than 4,000 customers in the UK since its launch in May, the Financial Times reported. It has also been hampered by the slowdown in global markets. The venture was forced to cut 150 of its 500 UK staff last month.

The FT said Merrill wants to cut its involvement as part of its plans to close loss-making businesses. But a complete withdrawal from the 50:50 venture would trigger penalty clauses. Merrill instead wants to revamp its involvement to cut its costs.

The service is aimed at individuals with more than £70,000 to play with. It offers high interest accounts, share dealing and other investment products outside the US. It also operates in Canada and Australia but its expansion into Germany and Japan has been frozen.

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