NEW YORK -- HSBC ( HBC) said Sunday it will sell 195 retail bank branches, most located in upstate New York, to First Niagara Bank in a deal worth about $1 billion.The sale is part of HSBC's strategy, presented to investors in May, to shift focus away from retail banking to commercial and corporate banking, and to target investment in high-growth economies. HSBC, which is still dealing with the legacy of bad loans in the U.S. from the 2003 acquisition of consumer lender Household International Inc., said in May that it intended to trim its costs by up to $3.5 billion within three years. The companies expect the all-cash transaction to be completed early next year. First Niagara, a unit of First Niagara Financial Group Inc. ( FNFG) of Buffalo, N.Y., said in a statement that it expects to retain most of the 1,900 workers currently employed by the affected banks. > > Bull or Bear? Vote in Our Poll HSBC Bank USA, a subsidiary of British banking company HSBC Holdings PLC, operates more than 470 bank branches in the U.S., including about 370 in New York. It has total assets of $197 billion through its retail, commercial, global and private banking segments and its wealth management divisions. The 195 banks being sold represent about $15 billion in deposits, and HSBC will receive a premium of 6.67% of the deposits transferred when the deal closes, the company said in a statement. Based on May 31 figures, that would be about $1 billion. >> Get your financial news on the go with TheStreet's iPad app. When the deal is completed, First Niagara expects to have $38 billion in assets, $30 billion in deposits and 450 branches in Pennsylvania, upstate New York and New England. The sale involves 183 branches in upstate New York, four in Westchester County, N.Y, two in Putnam County, N.Y., and six in southern Connecticut. The retail banks will remain open during the transition. HSBC will continue to provide commercial banking services in the region.