BSI will operate as a separate subsidiary within EFG International for a limited time until its full legal integration
Keystone
Zurich-based EFG International has completed the acquisition of Lugano-based BSI private bank from BTG Pactual. The preliminary purchase price is CHF1.06 billion ($1.07 billion).
This content was published on
2 minutes
swissinfo.ch and agencies, swissinfo.ch and agencies
This is significantly less than the CHF1.33 billion agreed with Pactual in February. In a statement on Tuesday, EFG said the “preliminary downward-adjustments of CHF217 million … reflect BSI negative net new money differences since November 30, 2015”.
Since the middle of this year alone, BSI’s assets under management have shrunk from CHF76 billion to CHF69 billion.
EFG said the final consideration for the purchase was still subject to customary final audit and hence further potential post-closing adjustments.
EFG International said it would exercise full management control of BSI with immediate effect. BSI would operate as a separate subsidiary within EFG International’s holding structure for a limited time until its full legal integration, expected in the second quarter of 2017.
“The closing of the acquisition marks a historic milestone for both EFG International and BSI. Together we are forming a leading pure play private bank with strong Swiss roots, a broad international presence and an entrepreneurial spirit,” said Joachim H. Strähle, CEO of EFG International, in a statement.
Adverse legal publicity
The sale in February came against the backdrop of adverse legal publicity at both BSI and Pactual. BSI paid the highest penalty ($211 million) last year in the United States tax evasion programme and now has one of its employees facing a court probe in Singapore connected with the 1MDB Malay sovereign wealth fund fiasco.
Pactual has also been dragged into recent legal complications after founder André Esteves was jailed in Brazil during a probe into the Petrobras corruption scandal.
Esteves was later freed on bail, but analysts believe the case has left the Brazilian bank short on liquidity.
You can find an overview of ongoing debates with our journalists here. Please join us!
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.
Read more
More
BSI bankers charged with 1MDB offences
This content was published on
Singapore’s Attorney General has also referred 11 other BSI staff, including senior management, to the public prosecutor to evaluate whether they have broken the country’s laws. In a statement of Monday, the Attorney General’s office said Yak Yew Chee and Yvonne Seah Yew are each facing seven charges for failing to disclose suspicious transactions to…
This content was published on
A survey by KPMG and the University of St Gallen maintains its prediction of last year that around a third of Swiss-based private banks will disappear as the industry realigns itself to a harsh new climate. The global crackdown on tax evasion and money laundering has also played a large hand in the industry’s declining…
This content was published on
The Swiss Financial Market Supervisory Authority (FINMA) has ordered BSI to disgorge CHF95 millionExternal link ($99 million) in profits for “serious breaches” of anti-money laundering rules. FINMA also effectively closed down the BSI, whose business is being taken over by EFG Bank, and is taking action against two executives. The FINMA investigation found BSI guilty…
Criminal case opened against BSI bank over 1MDB fund
This content was published on
The prosecutor’s office said on Tuesday it suspected ‘deficiencies in the internal organisation’ of BSI. “It is believed that due to these deficiencies, the bank was unable to prevent the commission of offences currently under investigation in the criminal proceedings relating to 1MDB,” it said in a statement. The criminal proceedings opened against BSI are…
You can find an overview of ongoing debates with our journalists here. Please join us!
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.