CIC in talks to sell private banking business in Singapore, Hong Kong to Indosuez

SINGAPORE — French financial services giant CIC said on Friday (June 16) it has entered into exclusive discussions to sell its private banking business in Singapore and Hong Kong to Indosuez Wealth Management, a division of France's Credit Agricole.

"Combining the CIC private banking business in Asia with that of Indosuez Wealth Management would provide the clients, staff and partners of this activity of CIC with opportunities to develop and grow under the ownership of a strong financial institution," CIC said.

No financial details were disclosed but a company official told Today the proposed deal will not result in any job cuts.

"No jobs will be lost with the transaction. It was one of our major objectives to ensure that good care will be taken of all our people. That is why we chose a bank (Indosuez) with similar values and capability to take the private banking business to the next level," he said.

"The company has been in Singapore since 1984. We are a full branch and intend to stay in Singapore for the long haul. Just under 300 people are employed at CIC, including staff in the private banking unit," he added.

The transaction would bring together two successful private banking businesses with similar cultures and values to create a broader and stronger footprint in Asia, CIC said, adding that it remains firmly committed to Asia and would focus on the development and growth of its core corporate banking, structured finance and institutional businesses in the region.

"It is not that we needed the money or that the business was not doing well. We made the decision to focus on our core strengths in corporate finance, structured finance and financial institutions. We will continue to focus on what we do well," the CIC official said.

The sale, subject to both regulatory approvals and customary employee consultation procedures in France, is expected to be finalised by the end of the year, CIC said.

The talks between the two French financial giants come as banks seek to grow fees from servicing Asia's well-heeled individuals to offset weak lending margins in a persistently low interest rate environment and bad debt from the beleaguered oil and gas sector.

Banks and asset managers have been expanding their wealth operations to take advantage of growing affluence in the Asia-Pacific region, where individual wealth surpassed that in North America for the first time in 2015, according to a Cap Gemini report. Last year, Singapore's largest bank DBS bought Australia & New Zealand Banking Group's retail and wealth operations in five markets, while the country's second-largest lender OCBC purchased British bank Barclays' wealth units in Hong Kong and Singapore.

In an interview with Bloomberg earlier this month, Mr Bahren Shaari, the chief executive of Bank of Singapore (BOS), the private banking arm of OCBC, said it intends to keep hiring more relationship managers and focus on serving a wealthier bracket of customers. BOS is now focusing on bulking up operations in Hong Kong, where it is looking to capture offshore money from China, he added. - WITH AGENCIES