The Swiss private banking group has closed the BSI acquisition for less than was previously estimated.

EFG International has completed the acquisition of fellow Swiss bank BSI from Brazil’s BTG Pactual for a preliminary SFr 1.06 billion.

The price tag includes SFr 575 million in cash, 86.2 million EFG shares valued at SFr 454 million and SFr 31 million of AT1 instruments issued by EFG International.

The acquisition was originally expected to cost SFr 1.328 billion before the purchase price was reduced to SFr 1.05 billion in August. The price of BSI, which suffered a net outflow of SFr 9.6 billion in the first half of 2016, was no doubt affected by the bank’s recent closure in Singapore. In May, the Monetary Authority of Singapore stripped BSI Bank of its merchant banking status over money laundering lapses, in connection with payments involving Malaysian state-run fund 1MDB. 

EFG said in a statement today that the acquisition makes it one of the largest private banks in Switzerland with around SFr 148 billion in assets under management and 7004 client relationship officers. It added that the combined business will have a “solid capital and liquidity position” with a Swiss GAAP common equity ratio of 16.8 per cent, total capital ratio of 19.4 per cent and liquidity coverage ratio of 219 per cent.

“Together we are forming a leading pure play private bank with strong Swiss roots, a broad international presence and an entrepreneurial spirit,” said Joachim Straehle, chief executive of EFG International.

“Over the coming months, we will jointly drive forward the integration to realise the full benefits of the business combination for our clients, employees and shareholders. The combined group will have a solid capital and liquidity position, which will support the further development of the business.”

As a security for potential indemnification claims by EFG International, 51 million EFG shares have been transferred into a Swiss escrow account and will be locked up for two years, the group said.