HSBC confirmed last week it was discussing the possible sale of the business, and National Bank, Canada’s No. 6 lender, has been seen as a likely suitor.
The two parties are now in the final stages of negotiating a deal, the Globe and Mail said.
A call to National Bank was not immediately returned.
The bank has stated publicly it wants to expand within Canada, particularly outside its home province of Quebec. Earlier this year, National bought the 82 percent of wealth management firm Wellington West that it did not already own for about C$273 million.
HSBC’s Canadian presence, like Wellington West‘s, is strongest in Western Canada.
HSBC has the largest Canadian presence of any foreign bank, and the sale of its retail brokerage, which sources have said could be worth somewhere between C$200 million ($202 million) and C$300 million, would continued a recent trend of foreign players exiting the Canadian market.
Recently, Bank of America (BAC.N) agreed to sell its $8.6 billion MBNA Canada credit card portfolio to Toronto-Dominion Bank (TD.TO). A year ago, Citigroup (C.N) sold its $2 billion Canadian MasterCard business to Canadian Imperial Bank of Commerce (CM.TO).
Shares of National Bank were up 11 Canadian cents at C$70.48 on the Toronto Stock Exchange.
Reporting by Cameron French in Toronto; editing by Rob Wilson