UPDATE 3-S.Korea's NPS to buy HSBC's London HQ for $1.3 bln

* Agreed sales of 8 Canada Square for 772.5 mln stg cash

* Deal confirms remarkable turnaround in UK real estate

* HSBC to make a profit of around 350 mln stg

* HSBC shares closed up 1.2 pct at 741.6 pence

(Rewrites with confirmation of the deal)

SEOUL/LONDON, Nov 13 (Reuters) - Global bank HSBC (HSBA.L) is selling its landmark European headquarters in London's Canary Wharf to South Korea's National Pension Service (NPS) for 772.5 million pounds ($1.3 billion), making it one of the world's biggest individual property transactions this year.

HSBC, Europe's biggest bank, said on Friday it would make a profit of about 350 million pounds on the sale and leaseback deal, which follows a similar sale last month of its New York headquarters on Fifth Avenue for $330 million.

It also plans to sell its premises on the Champs Elysees in Paris. [ID:nLT588764]

HSBC's shares jumped to their highest point in just over a year on Tuesday after it released an upbeat third-quarter trading update where it reported the first trimming in losses on U.S. consumer loans for three years. [ID:nLA616591]

The bank's better than expected performance in the first half of the year had prompted some analysts to suggest it could ask consultant CB Richard Ellis (CBG.N) to put the building sales on ice until the global economic recovery gathered pace.

However, cash-rich sovereign wealth funds and institutions have flocked to Britain's real estate market since prices finally hit a bottom in September, encouraging HSBC to take advantage of the spurt in demand.

"HSBC first sold its Canary Wharf headquarters in 2007 for a record-breaking 1 billion pounds at the peak of the market and then bought it back at a 250 million pounds profit last December," Nomura property analyst Mike Prew said.

"It's now reselling, this time in a quantitative-easing style boost to the market. It looks like HSBC is reading the UK real estate cycle better than the Real Estate Investment Trust (REIT) industry," he said.

Under the terms of the agreement with NPS, HSBC will retain full control of occupancy for the remaining 17.5 years of the existing 20-year lease period at a current rent of 46 million pounds a year.

The deal is expected to close by Dec. 31, 2009.

NPS, with around $200 billion in assets, plans to invest $3 billion in real estate in Tokyo, Sydney, New York and London this year.