The Asia-based bank told the media that its acquisition of Societe Generale Private Banking (SGPB) Asia’s businesses is expected to bring a 15% hike in group AUM to S$125 billion ($98.2 billion), and thereby a 23% rise in high-net-worth AUM to S$ 85 billion ($66.8 billion).
In consideration of possibilities of attrition, the bank expects at least $10 billion out of the $12.7 billion of AUM to be migrated from SGPB Asia’s clientele, which consists of a significant ultra-high-net-worth base.
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By GlobalDataPiyush Gupta, CEO of DBS bank, said: "In terms of client profile, they tend to have a higher-net-worth client base, especially in North and Southeast Asia. Their product suite reflects SocGen’s inherent strengths, especially in European-based structured products."
According to Private Banker International’s Asia Pacific Top 20 survey 2013, DBS was placed as the 9th largest bank in the region, while SocGen ranked 18th.
The memorandum of understanding between the two banks will bring DBS greater access to French bank’s European client base, Gupta elaborated to the media.
Gupta said: "We think there are revenue opportunities, to sell a full suite of banking products into the SocGen European customer base. We think there is revenue upside in being able to sell more European-linked products into our existing customer base."
DBS has seen a consistent decrease in its cost-to-income ratios from 95% in 2010 to 62% in 2013. As Tan Su Shan, head of consumer banking and wealth management described, this is attributed to both a reduction of costs and rising revenues, with a host of new online capabilities and platforms built over the past few years. This includes its launch of DBS Treasures Private Client and upgrade of its internet and mobile platforms in 2011, as well as its embarkation of a new digital strategy in 2013, which collectively brought AUM to S$69 billion ($54.2 billion) and a cost-to-income ratio of 62% in 2013.
The bank aims to boost its wealth management business from 12% of the Group’s profits to 15% over the coming three to four year period.