London, Oct 29: banking giant HSBC Holdings Plc said on Tuesday it was buying Bank of Bermuda for $1.3 billion in an all-cash deal to beef up its presence in the low-tax, private banking haven. In its second acquisition this month, the world's second-largest bank behind Citigroup will tap into Bank of Bermuda's extensive back office business for the global funds industry and its private banking division aimed at wealthy individuals.

"This is a very attractive, well-run institution that fits brilliantly with us," HSBC Finance Director Douglas Flint said, adding that the company was still on the look-out for bolt-on acquisitions.
The announcement comes a day after Bank of America unveiled the biggest US bank merger in five years with a $43 billion deal to buy FleetBoston Financial Corp., a move industry players say could spark a further round of buy-out activity in the United States. Bureau Report