The financial institution has been in exclusive talks with Nedbank majority owner Old Mutual for almost two months, but rival bidders will be allowed to enter negotiations from next week.
Insider sources told the Financial Times that it is unlikely a deal will be done before the exclusivity period finishes this weekend, after due diligence procedures on Nedbank took longer than expected to complete.
HSBC may now lose out in the battle to take over the South African firm to British rival Standard Chartered, which has previously expressed an interest in making the acquisition.
The latter company announced a Â£3.3 billion rights issue earlier this week, but Standard Chartered chief executive Peter Sands has already insisted that money will be put towards improving its capital ratio levels so the bank can comply with new international regulations.
"This is not a war chest for acquisitions," he said on Wednesday.
Standard Chartered is looking to raise its tier one capital ratio from nine per cent to around 11 per cent through the rights issue.
However, one source close to Standard Chartered said that the financial institution could be tempted into a bid for Nedbank if HSBC walks away and the asking price was dropped.
Old Mutual has put a price tag of around Â£5 billion on a 70 per cent stake in the firm, calculated on the basis of a 15 per cent premium on Nedbank's market price.
This would have to fall for Standard Chartered to make a bid, which would be a blow to Old Mutual as it is planning to use some of the money from a potential sale to pay down Â£1.5 billion of debt it wants to get rid of.
By Tony Aynsley