THE planned sale of Standard Chartered Securities has moved a step closer with the London-based bank making an exclusive offer to Goodwill Investment (Holdings). Goodwill, the Hong Kong merchant bank chaired by Fung Ka-pun, has until the end of this month to respond. Goodwill declined to comment. A market source said the offer came after a number of the brokerage's earlier suitors pulled out of negotiations. It is understood that both Standard Chartered Bank and Goodwill, which gained a back-door listing on the Hong Kong stock exchange by acquiring China Industrial International Corporation (CIIC) in June, still have many differences to resolve. The bank has insisted on retaining 20 per cent of the brokerage, a stance said to have caused past negotiations to collapse. Interested buyers have included Prudential Bache, part of the giant US bank insurer Prudential, Thai Military Bank and Bank of China, among others. All have terminated their talks with the bank because a price could not be settled. Christopher Castleman, executive director of the bank in London, said it was company policy not to comment on rumours. Sources indicated that the bank wanted to complete a deal now because staff morale was suffering and an exodus would make the business harder to manage. It has been estimated that Standard Chartered Securities cost more than $200 million a year to run and could, at best, bring in revenue of about $150 million. Other market sources believe that the brokerage's losses could be more than $50 million a year. Standard Chartered has been trying to dispose of the loss-making brokerage, which has operations in Hong Kong, Thailand, Indonesia, the United States and the United Kingdom, for well over a year. Its staff worldwide stands at about 270. Four months ago it was 330. In Hong Kong, the securities team of about 160 numbered more than 200 in June. Four directors of the Hong Kong team resigned in July when one of the negotiating parties withdrew. Goodwill Investment is 66 per cent held by a private holding company, Goodwill International (Holdings), 22 per cent by KB Fung, the largest shareholder, and 10 per cent by Kerry Group. Goodwill International is expected to generate profits of more than $100 million for the year. Goodwill is mainly engaged in financial services which cover stockbroking, corporate finance and commodity futures, direct investment and property investment. Goodwill is expected to emerge as the buyer of Standard Chartered Securities. One observer noted that Goodwill could use the purchase to expand regionally. Other shareholders in the private company include former stock exchange chief Charles Lee Yeh-kwong, Sun Hung Kai Properties, Lee Hing Development, Yiu Wing International, CNT Group and Sino Land. At this stage, however, it is uncertain the deal will definitely materialise. Standard Chartered has said it is reviewing its investment banking operation, which has been plagued by stock exchange compliance and regulatory breaches.