The T. Rowe Price Group has agreed to sell its banking unit to the investor Jacob Safra.
T. Rowe will receive book value of $24 million for the Baltimore-based bank, it said Wednesday in a filingwith the Securities and Exchange Commission. Safra plans to move the bank to New York City and rename it M.Y. Safra Bank following the acquisition, which is expected to close in the fourth quarter, pending regulatory approval. A spokesman for Safra could not comment further on the investors plans for the bank, citing the pending transaction.
Pending regulations spurred T. Rowe Price to sell the bank, a spokesman said.
"We anticipate that new regulations designed for banks, which would apply to T. Rowe Price due to our ownership of the bank, would significantly impact our ability to manage key aspects of our core investment management business," the company said an emailed statement. "As a result, and after careful study and deliberation, we came to the decision to sell the bank."
The investment firm established its bank unit in 2000. T. Rowe Price Savings Bank had $175 million in assets but no loans as of March 31. It primarily offers certificates of deposit, and held $134 million of available-for-sale securities and $40 million in interest-bearing balances at the end of the first quarter, according to the Federal Deposit Insurance Corp.
Jacob Safra is a the son of Moise Safra, who runs Banco Safra in Brazil with his brother, Joseph. Another brother, Edmond Safra, founded Republic Bank of New York, which was sold to HSBC in 1999. T. Rowe Price said it is selling the bank only to Jacob Safra, not the family.