HSBC eyes £4.5bn deal for South African bank

HSBC is set to enter exclusive talks over buying a controlling stake in South Africa's Nedbank in a deal worth £4.5 billion.

It is believed the group could make an announcement as early as this morning about the negotiations with Old Mutual, Nedbank's owner.

According to reports, the 52 per cent stake in Nedbank is the latest in a string of assets that UK-South African insurer Old Mutual has been forced to put up for sale since the credit crunch.

Nedbank is one of the largest financial groups in South Africa and has links with banks in 30 countries across the continent.

HSBC already has a small business in South Africa, as well as a number of interests across the rest of Africa.

HSBC chief executive Michael Geoghegan has made no secret of his ambitions to increase the bank's presence in emerging markets and he recently relocated from London to Hong Kong.

Old Mutual is understood to have received a number of approaches in recent years for its Nedbank holding, which foreign banks could use as a platform on which to build a business across the continent.

HSBC is said to have beaten off competition from Standard Chartered, which specialises in emerging markets, for the latest round of talks.

But there are concerns that the South African authorities may try to block the sale of Nedbank, following a run of acquisitions in the country by foreign banking groups.

No-one from HSBC could be contacted to comment on the report.