Royal Bank of Canada’s (RBC) wealth management arm is to buy the Latin American, Caribbean and African private banking business of Coutts, Royal Bank of Scotland’s private banking division.
Coutts’ business has client assets of more than $2bn and RBC will also be acquiring about 20 key private banking staff, with all based in Geneva apart from a team in the Cayman Islands.
Coutts key market strategy
Coutts said that its decision to sell the business, which accounts for around 2% of its total client assets, was part of a strategy of focusing on growth in its key geographies.
The strategy was initiated last year by CEO of wealth management in the RBS group Rory Tapner, and will see the bank focus on the UK, Switzerland, the Middle East, Russia and the CIS and selected Asian countries.
Coutts generates roughly 60% of its business in the UK and 40% globally and is attempting to reverse those proportions.
Tapner said: “Our Latin American, Caribbean and African business is solid. However, it requires further investment to reach our preferred market share and we have determined to focus our efforts on our core markets.”
RBC aims to expand market share
Profits at RBC’s wealth management division were up 21% last year, and the bank announced its key strategic priorities included expanding its geographic footprint, attracting more high net worth clients from the UK and emerging markets and expanding its share of global high and ultra high net worth assets.
Karen Simpson, general manager and head of private banking at RBC (Suisse) said: “This acquisition will enable us to increase our client base significantly in these three important target regions.”
The sale is expected to conclude towards the end of the first half of this year and the terms of the deal have not been disclosed.