RS2 has unexpectedly pulled out of the bidding process to buy HSBC Malta operations after HSBC reportedly increased its asking price. Sources who spoke to the Times of Malta confirmed that RS2, which had partnered with an unnamed bank to jointly acquire HSBC Continental Europe’s 70% stake in the local bank, pulled out after the asking price was increased. The two companies had reportedly submitted an offer well above the €204 million paid by HSBC Continental Europe to acquire the same stake from HSBC London in 2022.

Despite RS2’s withdrawal, its partner bank is continuing negotiations independently and remains in discussions to reach a potential agreement.

RS2 had earlier pledged to revive the iconic Mid-Med Bank brand as part of its bid. Questions have been sent to the company but no comment has been issued.

Other bidders remain in the race, but each is facing challenges of its own. A Maltese business consortium has submitted what is understood to be a lower-value offer believed to fall under the €200 million mark. However, the consortium has been weakened by the withdrawal of several initial members and is reportedly facing questions about its financial and technological capabilities.

Two non-EU Eastern European banks have also expressed interest, each with separate offers. Both are believed to have submitted bids below the €200 million threshold, with one of the banks facing reputational concerns flagged during due diligence.

With RS2 out and other bids facing difficulties, the deal’s conclusion—originally targeted for late spring—is now uncertain. The extended timeline could have implications for Malta’s financial stability, with Finance Minister Clyde Caruana previously warning that the sale “cannot take forever.” The European Central Bank has also raised concerns with Maltese authorities about the protracted process.