J Safra Sarasin has reached an agreement with Bank of Montreal (BMO) to acquire its private banking businesses in Hong Kong and Singapore by way of an asset purchase agreement, according to a statement from J Safra Sarasin.
The acquisition is expected to be completed during the course of the first half this year, subject to regulatory approvals, the firm said, but did not disclose the financial terms.
The acquisition will include clients and their relationship management teams, it added.
The move marks another step in the implementation of J Safra Sarasin’s international growth strategy and will allow it to further enhance its presence in Asia. Currently, it has branches in Hong Kong and Singapore, which provides private banking and wealth management services to private and institutional clients in the region.
“This transaction underscores the importance of the Asian market for the group. We believe that BMO’s private banking business in Asia will fit extremely well with our strategy,” Jacob Safra, J Safra Sarasin’s chairman, said in the statement.
The move comes after nearly a year when J Safra Sarasin named Andy Chai as its new Asia CEO, replacing Enid Yip, who was appointed as a member of the board of both J Safra Sarasin Holding and J Safra Sarasin.
Globally, J Safra Sarasin managed CHF 185.8bn ($209.8bn) in client assets at the end of December and employed around 2,200 staff, according to the statement.
In Asia, the wealth management industry is still undergoing a period of consolidation in the region, especially when operating and compliance costs have gone up.
Several wealth management firms have consolidated in the past years, which include the closing of Edmond de Rothschild Asset Management’s branch in Hong Kong, Indosuez Wealth Management’s acquisition of the private banking division of Credit Industriel et Commercial (CIC), National Australia Bank’s sale of its private wealth business in Hong Kong and Singapore to OCBC and LGT Group acquiring ABN Amro’s private banking business in Asia.
Meanwhile, other banks have restructured their wealth management businesses. For example, Standard Chartered in 2020 announced that it will be combining its retail, private banking and wealth management businesses into one segment, effective this year. In a similar move, HSBC also announced that it will restructure its wealth management business to combine both high net worth and retail investors in one unit.