DBS Bank is snapping up French bank Societe Generale's Asian private banking arm in a bid to grow its wealth management business.
It has agreed to pay $279 million to buy SocGen's private banking business in Singapore and Hong Kong plus selected parts of its trust business, it said on Monday.
That sum represents about 1.75 per cent of the $16 billion worth of assets under management by SocGen's Asian private banking business as of Dec 31 last year.
The deal will "accelerate DBS' ambition of becoming a leading wealth manager in Asia, effectively increasing DBS' high net worth assets under management by more than 20 per cent", the bank said in a statement.
DBS chief executive Piyush Gupta added that it would also create value for high net worth customers from both banks and give employees more career development opportunities.
As part of the deal, customers of SocGen's private banking business in Asia will have access to DBS' universal banking platform, DBS said. DBS clients will also have access to SocGen's private banking in Europe.
The two banks can also save money by pooling their infrastructure, IT and other support services.
Ms Tan Su Shan, who heads consumer banking and wealth management at DBS, said that its private banking business had consistently grown by about 20 per cent a year for the past three years and had "now reached a stage where we are ready for inorganic growth".
"This transaction will give us access to new clients and strong, experienced teams, thereby strengthening our position as a top-tier wealth manager in the region."
DBS will pay for the acquisition using its internal cash resources.
The purchase price is subject to adjustments based on the net asset value and assets under management of the business at the completion of the transaction.
Its shares were flat at $15.73 in trading late Monday morning.