Singapore’s OCBC Bank has announced that its wholly-owned private banking subsidiary, Bank of Singapore, is to acquire the wealth and investment management (WIM) business of Barclays in Singapore and Hong Kong for approximately US$320m in cash.
Barclays is selling the business as part of its ongoing drive to reduce the scale and risk level of its operations.
The deal is subject to regulatory approval, and is expected to complete before the end of the year.
OCBC confirmed in a statement a purchase price set at 1.75% of Barclays WIM Singapore and Hong Kong’s assets under management, which it noted was to be transferred to its Bank of Singapore operation upon the completion.
Barclays WIM Singapore and Hong Kong’s AUM stood at an estimated US$18.3bn at the end of December. The business has more than 1,800 clients.
The purchase price of US$320m will be paid from Bank of Singapore’s own resources, with the completion expected by the end of the year, the OCBC (Oversea-Chinese Banking Corp) said in a statement announcing the deal.
The bank said that the acquisition will further its strategic goal of deepening its presence in its four core markets – Singapore, Malaysia, Indonesia and Greater China.
At completion, Bank of Singapore will have an increased total of about 400 relationship managers to serve its enlarged client base, and will be strongly positioned for further increases in AUM, as it plans to “deepens its market penetration”.
OCBC Bank bought ING Asia Private Bank in 2010, and renamed that business Bank of Singapore after combining it with its own private banking business at that time. Since then, its AUM more than doubled, to US$55bn, making it one of Asia’s largest private banks, according to its statement.
AUM increase by a third
With the addition of the assets currently held by Barclays’ WIM Singapore and Hong Kong operation, Bank of Singapore’s AUM will rise by 33.3% to US$73.3bn, OCBC said.
Bahren Shaari, chief executive of the Bank of Singapore, said the acquisition, once completed, would “further broaden” the bank’s geographical footprint and client coverage, “while adding scale” and deepening its presence in its core Asian markets, which he said included Southeast Asia, Greater China, and the Middle East.