Merrill lynches HSBC joint venture

HSBC and Merrill Lynch are to close their online banking venture for high net worth individuals, just two years after its high profile launch.

The project attracted fewer customers than expected, and will now be folded into HSBC.

The unit held around 100,000 accounts worldwide, and had a net asset value of $109m (£75m) at the end of 2001, despite the two parties committing more than $1bn (£650m) of investment capital over five years.

The unit will keep its original name of Merrill Lynch HSBC, and customers will still have access to a number of Merrill's services such as research and settlement, for a transitional period of two-and-a-half years.

The company said in a statement that "economic conditions and low online investor volume have created a difficult trading environment for the joint venture and business expansion plans have been postponed for the time being."

It added: "Following a strategic review of the joint venture, it was considered that the business could be developed more effectively if integrated within the HSBC Group rather than remaining as a joint venture."