DBS to buy out Société Générale’s private banking business in Asia

DBS Bank has announced that it has reached an agreement with Société Générale to purchase its private banking business and part of its trust business in Hong Kong and Singapore for $220m. Société Générale said until the transaction takes place, by the end of this year, business will be as usual for its private banking structured products.

DBS Bank announced yesterday that the price represents 1.75% of Société Générale private banking’s $12.6bn of assets as of 31 December 2013 and the transaction will effectively increase the scale of its wealth management business by more than 20%. The whole process of purchasing is expected to be finished by Q4 this year.

Olivier Gougeon, the regional chief executive officer of Société Générale private banking, told SRP that the purchase will have little impact on its existing private banking structured products.

“Currently, it is mainly business as usual until the transition takes place which is anticipated in Q4 this year,” he said. “Our private banking structured products offer is based on an open architecture and is not limited to our own products. There will be no impact on the private banking or corporate investment side.”

Gougeon added that Société Générale’s proven track record in structured products would enhance the product offering available to clients of both firms.

After the transition, clients from both banks will benefit from an expanded suite of products and services by having access to the other bank’s platform including retail, corporate and investment banking.

Tan Su Shan, head of consumer banking & wealth management of DBS, said the bank’s private banking business has consistently grown by about 20% a year through internal growth and mergers. After the integration, the bank will be able to introduce Société Générale’s offerings in Europe as well as its corporate and investment banking solutions.

There are about 350 employees in Société Générale’s private banking business, DBS Bank said there will be no immediate change to the current team size.

DBS Bank is active in issuing structured products in both the Hong Kong and Singapore market. In Singapore the bank launched 12 currency linked investments last year while in Hong Kong DBS Bank issued 48 structured products – mainly deposits – in 2013.