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RBS sells overseas wealth management arm

RBS sells overseas wealth management arm

The Royal Bank of Scotland Group has reached an agreement to sell its internationally-managed private banking and wealth management business to Union Bancaire Privée as part of its strategy to become a “truly UK-focused bank”.

RBS will continue to service UK private banking and wealth management client needs, together with those of international clients that have a strong connection to the UK, through its Coutts and Adam and Company brands.

The deal includes relationships managed from Switzerland, Monaco, UAE, Qatar, Singapore and Hong Kong.

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As at 31 December 2014 assets under management were approximately CHF32bn (£22bn) and total risk weighted assets were CHF2bn (£1.39bn). The price paid will be determined in part by assets under management on closing, but RBS anticipates receiving a premium.

The resulting capital benefit to RBS is expected to be modest, after writing off goodwill related to the business and taking into account anticipated exit and restructuring costs.

The business to be sold will be treated as a ‘disposal group’, resulting in an expected charge in the order of £200m, primarily relating to the goodwill write-off.

Initial closing of the transaction is envisaged in the fourth quarter, when a majority of the business is expected to transfer, with the remainder during the first part of 2016.

The sale, supported by Goldman Sachs, is subject to regulatory approvals and comprises client relationships outside the British Isles, as well as associated staff.

Alison Rose, chief executive for commercial and private banking at RBS, commented that this is another step in the process of becoming a truly UK-focused bank.

“Following an extensive review, it was clear that the bank we are building would not be the most appropriate owner of the business being sold.

“We gave careful consideration to identifying a buyer with the capability to take on this business in order to minimise the impact on clients and staff,” she continued, adding that there will be no interruption of service for Coutts or Adam and Company clients.

“Our private banking brands are integral to RBS, supporting our ambition to make this the number one bank for customer service, trust and advocacy in the UK.”

Yesterday (26 March), RBS also took another step in its strategy to fully exit holdings in Citizens Financial Group by the end of 2016 as part of its European Commission state aid commitments, offering up 135m worth of shares.

peter.walker@ft.com