Consolidation in the private banking sector has gathered momentum with two new deals, and analysts see more action on the horizon as improving financial health, stiffer regulation and tighter competition drive stronger players to snap up assets at bargain prices.
In the biggest industry deal since the financial crisis began, Oversea-Chinese Banking Corp. announced Thursday that it would buy the Asian private banking assets of the recovering Dutch banking giant ING Group NV for $1.46 billion.
In London, the private-equity firm RHJ International said it would buy the U.K.'s Kleinwort Benson Private Bank Ltd. and its Channel Islands unit from Commerzbank AG. The deal price was not disclosed.
The deals come after Julius Baer Group AG's purchase of ING's Swiss private banking operations for about $500 million in early October.
Switzerland's Bank Vontobel AG bought Commerzbank AG's Swiss business in July, and Liechtenstein's LGT Group took over Dresdner Bank's Swiss unit.
More deals are in the offing, analysts say, as private banks look to bulk up assets under management to generate economies of scale and cut costs. Relatively low asset prices provide attractive buying opportunities, analysts said.
OCBC's assets under management would grow more than threefold, to $23 billion, with the ING unit's purchase, lifting the banking company into the top 10 of Asian private banks.