Swiss private bank UBP acquires Lloyds’ international private banking arm for £100m

Swiss private bank Union Bancaire Privee UBP SA has agreed to take over UK Lloyds Banking Group plc’s (LON:LLOY) international private banking arm for up to GBP100m (USD151.7m/EUR117m) in cash, the companies said in separate statements.

The target offers various personalised banking, investment and planning services to high net worth individuals and families. Last year it posted a loss of some GBP50m. The deal involves branches in Geneva, Zurich, Monaco and Gibraltar and a representative office in Montevideo. The agency office in Miami, as well as Lloyds’s UK offshore businesses, including the Channel Islands, Isle of Man and Gibraltar, are not part of the transaction, the vendor said.

The purchase price includes an initial payment of GBP65m, to be made at closing, with the remainder of the sum to be provided as a deferred payment over a period of two years, depending on the business’s performance.

The acquisition, which is in line with UBP’s growth strategy, will allow the company to enhance its presence in Switzerland, as well as in its core growth markets, including the Middle East and Latin America. The addition will bolster its assets under management by more than CHF10bn (USD10.4bn/EUR8bn). At the end of April, they stood at at CHF83.2bn, the buyer said.

On the other hand, Lloyds stated that the sale was part of a plan to shrink and simplify its international presence, while focusing on the UK, Channel Islands and the UK Expat marketplace.

The transaction hinges upon regulatory approvals, among other conditions. It is seen to be completed in stages. The vendor said it expects to transfer the bulk of the business in the second half of 2013 and the remaining part by the first quarter of 2014. It added that in line with its strategy, it will also intended to exit South Africa.

UBP took counsel from Caurus Partners Sarl and MilleniumAssociates AG on the transaction.