The purchase price, which includes equity, covers businesses with collective AuM of almost €25 billion. Union Bancaire Privée said the deal will add to its UK and Swiss footprint, while the French lender is aiming at a more "streamlined" business model.

Union Bancaire Privée has agreed to buy Société Générale Private Banking Suisse and SocGen’s UK and Channel Islands wealth management arm – SG Kleinwort Hambros. The total consideration is for about €900 million ($981 million). 

Société Générale said that almost €25 billion of assets under management are covered by the agreements, as of the end of December 2023. 

The consideration includes equity; the sale will boost SocGen’s group Common Equity Tier 1 ratio by about 10 basis points. The transaction is expected to take place at the end of the first quarter of 2025, UBP said in a statement today. 

The deal is another twist in the ownership structure of Hambros, bought by SocGen in 1998. It grew through tie-ups with Kleinwort Benson and Barings Asset Management’s private client unit. In 2023, there was media speculation that SocGen was considering offloading its Swiss banking unit and Kleinwort Hambros to free up capital. 

In its statement about the reasons for the deal, SocGen said: “These sales are part of the execution of Société Générale's strategic roadmap targeting a streamlined, more synergetic and efficient business model, while strengthening the group’s capital base.

“Société Générale intends to pursue the development strategy of its private bank by relying on its leading positions in France and abroad, in Luxembourg and Monaco, to support its high net worth clients thanks to its expertise and recognised services,” it said.

Last week (1 August), SocGen said group net income for the second quarter of 2024 was €1.113 billion, rising from €900 million a year ago. Its return on tangible equity rose to 7.4 per cent from 5.6 per cent, and the cost/income ratio narrowed to 68.4 per cent from 70.6 per cent. 

UBP’s growth goals
For UBP, headquartered in Geneva, the SocGen acquisitions are important for building its “strategy to grow its global presence and its wealth management activities worldwide,” UBP said. “This acquisition will further increase the bank’s footprint in Switzerland, and will accelerate its expansion in the UK, where UBP has been developing its activities for nearly three decades, in both wealth and asset management.”

UBP had SFr150.8 billion ($177 billion) in assets under management at the end of June this year, with a further SFr25 billion-plus sum to be added to that figure.

“Société Générale Private Banking Suisse and SG Kleinwort Hambros’ expertise in the fields of private banking, asset management and wealth planning has long been recognised throughout the industry. It is an ideal complement to UBP’s know-how in wealth management solutions for both private and institutional clients,” UBP said. “The onboarding of these teams will also contribute to broadening UBP’s presence in selected jurisdictions, once the requisite regulatory licences have been granted, including in the Channel Islands and Gibraltar.”

The transaction comes at a time of continued M&A activity in the European private banking and wealth sector. A year ago, the industry was upended by the “shotgun wedding” of UBS and Credit Suisse, leaving Switzerland with one universal bank. There had been rumours earlier this year that Zurich-listed Julius Baer and EFG International, another Switzerland-listed private bank, had been in discussions. 

This publication has contacted both banks for further details, including the potential impact, if any, on staffing arrangements and costs.