Royal Bank of Scotland (RBS) has agreed to sell Coutts International to Union Bancaire Privée UBP SA (UBP), after numerous months of negotiations.
RBS will continue to service private banking and wealth management responsibilities in the UK and the deal will affect client bases in regions including Switzerland, UAE and Singapore.
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On 20th March 2015, PBI reported that UPB and RBS were close to forging a deal.
As of 31 December 2014, Coutts International’s assets under management (AuM) were approximately CHF32bn ($33.1bn) and total risk weighted assets were CHF2bn. The price paid will be determined in part by AuM on closing.
UBP, a Swiss private bank headquartered in Geneva, has assets under management of CHF 98.7 bn ($102.8bn), as of January 2015.
There had been industry speculation of a $600m deal to acquire Coutts International after RBS put the private bank up for sale.
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By GlobalDataThe 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 the 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.
RBS, in August last year, unveiled plans for the sale of Coutts’ international unit.
In October, RBS hired Goldman Sachs to oversee the sale process and formally began taking bids for Coutts International in December.
Coutts International formed a majority of RBS’s private banking operations, with the unit housing $36bn of roughly $50bn in assets that the entire business manages.
Alison Rose, CEO, commercial & private banking at RBS said: "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.
"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."
The transaction is subject to regulatory approvals
