UBS Europe in deal to acquire Nordea’s Lux-based private banking business

Switzerland banking giant UBS said today that it has agreed a deal to acquire part of the Luxembourg-based private banking business of Nordea, the Scandinavian financial services group.

No purchase price or other financial information about the deal were given. However, in a joint statement, the two institutions said that the details of the transaction, and its completion — currently planned for the second half of this year — “remain subject to applicable regulatory approvals and a number of conditions”.

The transaction would have a “marginal positive impact” on Nordea’s common equity tier 1 capital ratio, while the business being acquired had assets under management at the end of 2017 of €13bn (US$16.24bn, £11.4bn).

Fit for biz strategies of both UBS and Nordea

The transaction is described as fitting the business strategies of both institutions, as Nordea looks to concentrate its private banking activities on the Nordic region, in the wake of a recent strategic review of its international private banking operations, and UBS prepares to further “grow its presence” and boost its offering as a wealth manager for Nordic clients in Europe.

Nordea Asset Management will continue to operate in Luxembourg, the banks said in a joint statement today. Snorre Storset, head of wealth management at Nordea, said: “Luxembourg is a financial centre for asset management. Hence it is natural for us to have a presence, since competence and infrastructure is well established.”

As for UBS, René Mottas, country head of UBS Luxembourg, said, the deal would enable it  “to move our business of servicing Nordic wealth management clients to a leading position in Luxembourg and in Europe”.

UBS, he added, sees itself as “an attractive home for Nordea’s transferring clients and employees”.

As reported, UBS created UBS Europe SE in late 2016, with its head office in Germany, and branches located in Luxembourg, Italy, Spain, Austria, Sweden and Denmark, in a move it said was aimed at creating a “pan-European wealth manager”. UBS Luxembourg’s role in this structure is as a “competence centre for hosting and servicing the cross-border business for clients domiciled in the EEA”, alongside “an active growth strategy for the Nordics cross-border market”.

Based in Zurich and listed on the SIX Swiss Exchange and New York Stock Exchange, UBS has offices in 54 countries, with about 34% of its employees working in the Americas, 35% in Switzerland, 18% in the rest of Europe, the Middle East and Africa and 13% in Asia Pacific. Altogether it employs around  60,000 people.

Nordea Bank SA was founded in 1976. Its private banking operation is centred in Luxembourg, with a branch office in Singapore.

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