AMSTERDAM • ABN Amro agreed to sell its private banking assets in Asia and the Middle East to Liechtenstein-based LGT to focus on its European operations.
The unit manages about US$20 billion (S$28.4 billion) in Singapore, Hong Kong and Dubai, representing about 10 per cent of ABN Amro's private banking assets globally, the Dutch bank said in a statement yesterday .
The company expects a "substantial book gain" on the sale, it said without disclosing a selling price, Bloomberg reported.
"After a strategic review, we have decided to focus on further strengthening and growing our private banking activities in northwest Europe," Mr Jeroen Rijpkema, the chief executive officer of ABN Amro Private Banking International, said in the statement.
"The transfer of our private banking business in Asia and the Middle East is the logical step in implementing this strategy."
Julius Baer and DBS had also considered bids for the unit, which could fetch more than US$300 million based on the valuations of other recent deals, people with knowledge of the matter said in October, Bloomberg said.
SHIFT IN FOCUS
After a strategic review, we have decided to focus on further strengthening and growing our private-banking activities in north-west Europe.
MR JEROEN RIJPKEMA, the chief executive officer of ABN Amro Private Banking International.
LGT, owned by the Princely House of Liechtenstein, will increase its assets under management to more than US$40 billion in Asia and about US$160 billion in total, it said in a separate statement.
It employs over 2,500 people who are based in 20 locations in Europe, the Americas, Asia and the Middle East.
The acquisition via an asset purchase agreement marks a major step in the implementation of LGT's growth strategy and will further enhance its strong footprint in Asia and the Middle East, LGT said.
The employees that will transfer from ABN Amro as part of the acquisition will be integrated into LGT's regional entities in Hong Kong, Singapore and Dubai. They will continue to look after their clients.
Prince Max von und zu Liechtenstein, who is chief executive officer of LGT, said: "Building on our successful presence in Asia and the Middle East, and on ABN Amro's long tradition in serving clients in the region, this acquisition will allow us to further extend our market position and to achieve further profitable growth. Thanks to our long term-oriented ownership and strategy, our strong capital base and our high-quality services in wealth and asset management, we can offer attractive opportunities to ABN Amro's clients and employees."
Completion of the transaction is expected to take place in the second quarter of next year, subject to approvals from the authorities.