The Royal Bank of Scotland Group plc (“RBS”) has announced it has reached an agreement to sell its internationally managed Private Banking and Wealth Management business to Union Bancaire Privée UBP SA (“UBP”).
The sale comprises client relationships outside the British Isles and associated staff. RBS will continue to service UK Private Banking and Wealth Management client needs, together with those of international clients with a strong connection to the UK, from the British Isles through its Coutts and Adam & Company brands. The transaction is subject to regulatory approvals.
The sale includes relationships managed from Switzerland, Monaco, UAE, Qatar, Singapore and Hong Kong. As at 31 December 2014 assets under management were approximately CHF32bn and total risk weighted assets were CHF2bn. The price paid will be determined in part by assets under management on closing. RBS anticipates receiving a premium. The resulting capital benefit to RBS is expected to be modest after writing off goodwill related to the business and taking into account anticipated exit and restructuring costs. In the Q1 2015 results, the business to be sold will be treated as a disposal group, resulting in an expected charge in the order of £200 million, primarily relating to goodwill write off. Initial closing of the transaction is envisaged in Q4 2015, when a majority of the business is expected to transfer, with the remainder during the first part of 2016.
Alison Rose, CEO, Commercial & Private Banking at RBS commented;
“Last year we set out a clear strategy to create a truly UK-focused bank. This announcement is another important step in that process. Following an extensive review, it was clear that the bank we are building would not be the most appropriate owner of the business being sold.
“We gave careful consideration to identifying a buyer with the capability to take on this business in order to minimise the impact on clients and staff. We believe that in UBP we have found a good long term owner for this business.
“There will be no interruption of service for clients of Coutts or Adam & Company and we remain committed to improving all aspects of our market leading businesses.
“Our Private Banking brands are integral to RBS, supporting our ambition to make this the number one bank for customer service, trust and advocacy in the UK.”
The transaction, supported by Goldman Sachs, is subject to regulatory approvals.