HSBC has agreed to sell its general insurance businesses to French insurer AXA Group and Australia's QBE Insurance Group for $914 million in cash, as Europe's biggest bank moves ahead with its plan to divest non-core assets.

The deal, the latest in a series of cost cutting initiatives under the new HSBC CEO Stuart Gulliver, includes a 10-year bancassurance agreements with AXA and QBE.

HSBC has cut 11,000 jobs and sold 19 businesses as part of Gulliver's plan to cut annual costs by $3.5 billion. Deals already struck will cut $50 billion in risk-weighted assets.

For AXA, the acquisition is a step forward in its effort to boost emerging markets presence and potentially helping Europe's No. 2 insurer to achieve its 2015 targets ahead of time.

AXA's regional Chief Financial Officer François-Valéry Lecomte told a media conference that the 2015 targets were based on organic growth and this transaction accelerates that.

AXA is hoping to double its gross revenues and triple its underlying earnings by 2015 for its general insurance business, under a plan launched last year to boost profits.

HSBC shares fell 1.6 per cent to HKD$67.70 by mid-day in Hong Kong trade, more than the 0.8 per cent drop in the benchmark Hong Kong share index. QBE shares rose 1 per cent to A$11.94, bucking a 1.5 per cent fall in the benchmark Australian share index.

AXA is paying $494 million for the assets in Hong Kong, Singapore and Mexico, which had a net asset value of $48 million at the end of 2011, HSBC said in a stock exchange filing.

QBE will pay $420 million for the business in Argentina, which had an net asset value of $189 million. QBE, Australia's No. 1 insurer by premium, has completed  more than 75 deals in 10 years, expanding its reach to 50 countries.

In May, HSBC announced plans to sell non-core businesses, which included shrinking its network of 475 U.S. branches to focus on the international business of US clients and the sale of several European retail banking businesses including those in Poland and Russia.

The deals are subject to regulatory approvals and are expected to close in the second half of 2012, while the deal in Argentina may close earlier, HSBC said. The gross asset value of the businesses being sold was $1.23 billion at the end of 2011, it added.

AXA will rise to No.1 ranking in Hong Kong and Mexico and to No. 2 ranking in Singapore following the deal, the company said. QBE said it expects its part of the acquisition to add to its earnings in the first full year.

HSBC was advised by HSBC Global Banking and Markets and co-advised on the sale of its Latin American assets by Goldman Sachs. Citigroup was the sole financial advisor to AXA, a source familiar with the matter said.-Reuters