By Rita Trichur, Ben Dummett and Gillian Tan
Two of Canada's biggest banks looked at Boston Private Bank
& Trust Co. as a potential acquisition target, according to
people familiar with the matter, underscoring Canadian lenders'
growing interest in expanding their U.S. wealth-management
businesses.
Royal Bank of Canada was in active talks to acquire Boston
Private before reaching a deal to buy another U.S.-based lender
last month, two people said. One of them said RBC ultimately
decided that Boston Private wasn't a good fit because it wanted a
wealth-management platform, not a private banking platform.
Canadian Imperial Bank of Commerce also had Boston Private on a
list of potential acquisition targets, a third person said.
It is unclear whether Boston Private is running an active
auction process. RBC and Boston Private declined to comment.
"We don't comment on rumors or speculation," said CIBC spokesman
Kevin Dove.
RBC had initially valued Boston Private, which specializes in
wealth management and private banking, at about $2 billion,
according to one of the people, who also said RBC later concluded
that valuation was too high. RBC was also in serious discussions,
but later passed on, buying First Republic Corp. in San Francisco,
according to people familiar with the matter.
Instead, RBC agreed in January to acquire Los Angeles-based City
National Corp. , in a deal worth $5.4 billion. That deal will add
an attractive roster of high-net-worth clients in the entertainment
business.
Canadian banks are eyeing expansion in the lucrative U.S. wealth
management market, as growth prospects for their domestic retail
business slow in an already-saturated market north of the
border.
Investment bankers pitched both RBC and CIBC on the idea of
buying Boston Private, one of the people said. It is not clear,
however, whether CIBC held talks with Boston Private on doing a
potential deal.
CIBC's new chief executive, Victor Dodig, has said repeatedly in
recent months that the bank is scouring the U.S. market for private
banking and wealth-management acquisitions valued up to 2 billion
Canadian dollars ($1.59 billion).
Last year, CIBC lost out against the London Stock Exchange Group
PLC to buy Russell Investments , a stock-index and asset-management
business, The Wall Street Journal reported.
Boston Private, a subsidiary of Boston Private Financial
Holdings Inc., serves clients in Boston, San Francisco, San Jose
and Los Angeles. Its assets under management totaled $4.7 billion
at the end of June 2014, according to the latest financial
information posted on its website.
Last July, Boston Private announced a deal to acquire
Florida-based investment advisory firm Banyan Partners LLC--a
transaction that was expected to increase its total AUM to $9
billion.
Julie Steinberg contributed to this article.
Write to Rita Trichur at rita.trichur@wsj.com, Ben Dummett at
ben.dummett@wsj.com and Gillian Tan at gillian.tan@wsj.com
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