By Max Colchester and John Letzing
LONDON-- Royal Bank of Scotland Group PLC will soon announce the
sale of the international arm of its wealth business Coutts to
Swiss bank Union Bancaire Privée, according to people familiar with
the matter.
In recent months RBS, which is 80% owned by the U.K. government,
has been in protracted negotiations over the sale of Coutts
International. UBP saw off interest from Credit Suisse Group AG and
a consortium of Société Générale SA and DBS Bank Ltd, according to
people familiar with the matter. Analysts have speculated that the
unit could be sold for around $600 million.
Geneva-based UBP has reported having 98.7 billion Swiss francs
(about $102.7 billion) in assets under management as of the end of
last year, a 12.5% increase compared with 2013. The bank has
pursued a strategy in recent years of expanding through
acquisitions, agreeing in 2011 to buy Dutch lender ABN AMRO Group
NV's Swiss bank and reaching a deal in 2013 to acquire U.K.-based
Lloyds Banking Group's international-private banking business.
RBS said last August that it would focus on U.K. high-net-worth
customers and cut the international-wealth unit. RBS said Coutts
International would struggle to hit a profitability target of 15%
return on equity as it lacked scale. The unit employs around 1,200
staff across seven countries, including offices in Zurich, Abu
Dhabi and Singapore. As of December it had GBP14.5 billion of
assets under management.
Similar to other banks with a presence in Switzerland, Coutts's
Swiss business is currently participating in a U.S. Justice
Department self-reporting program designed to unearth untaxed
American assets, which may result in fines for banks but could also
provide guarantees they won't be prosecuted in the U.S. RBS said it
expects to reach a related resolution with the U.S. Justice
Department this year. UBP has already said previously that it is
participating in the self-reporting program.
Write to Max Colchester at max.colchester@wsj.com and John
Letzing at john.letzing@wsj.com
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