HSBC to Sell Some Swiss Private Bank Assets to Liechtenstein Group

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The LGT Group Foundation of Liechtenstein.Credit Eddy Risch/Keystone, via Associated Press

LONDON – The British bank HSBC said on Tuesday that it had agreed to sell a portfolio of Swiss private banking assets to a unit of the LGT Group Foundation of Liechtenstein.

The business being sold had assets under management of about $12.5 billion at the end of 2013 and employed about 70 people.

Terms of the deal were not disclosed, but it is expected to be an all-cash deal, LGT said.

“The opportunity to acquire this portfolio has arisen following a strategic business review by HSBC to concentrate its growth on a focused group of markets,” LGT said in a statement.

The sale is the latest move by HSBC, one of the world’s largest banks, to reduce its costs and improve its profitability by focusing on higher-margin businesses.

HSBC Life said this month that it would sell its corporate and individual pension policies business in Britain and associated annuities business to Admin Re, a unit of Swiss Re.

On Tuesday, HSBC, based in London, said it remained “fully committed” to Switzerland as a major international center for its global private banking business.

For the LGT Group, the portfolio is expected to increase the position of its wealth management business in several markets, including Central and Eastern Europe, Latin America and Western Europe.

After the closing, the HSBC business will be integrated into the LGT Group’s LGT Bank in Switzerland, which had 21 billion Swiss francs, or about $24 billion, in assets under management at the end of 2013.

The transaction is expected to be completed in the fourth quarter and is subject to regulatory approval.

The LGT Group is one of the largest privately held private banking and asset management groups in Europe and is run by the royal family of Liechtenstein.

When the deal is completed, the LGT Group is expected to have assets under management of about 120 billion francs and almost 2,000 employees.

HSBC operates in more than 75 countries and had assets of $2.76 trillion at the end of the first quarter.