Bank Leumi Announces Strategic Cooperation with Julius Baer
Under the agreement, Leumi will transfer its private banking business in Switzerland and Luxembourg to Julius Baer
Rakefet Russak-Aminoach, President and CEO of Leumi: "The unique cooperation with Julius Baer is yet another step we are implementing with the aim of adapting ourselves to the new banking era and the evolving regulatory requirements in the global private banking arena"
The Leumi Group announced today that it has entered into a strategic cooperation agreement with Julius Baer, the leading Swiss private banking group. Under the agreement, the Leumi Group will refer existing and future clients, with private banking needs in Europe and the Far East, to Julius Baer, while at the same time Julius Baer will refer existing and future clients to Leumi’s domestic banking services in Israel.
In addition, Leumi will exit its private banking business which is managed today through the bank's subsidiaries in Switzerland ("Leumi Private Bank") and Luxembourg ("Leumi Luxembourg S.A"), and will transfer the majority of its respective international private banking clients to Julius Baer.
Julius Baer will purchase most of Leumi's private banking operations in Switzerland for CHF 10 million above capital. Leumi Private Bank and Julius Baer will cooperate closely to ensure a smooth transfer of the majority of the client relationships in Switzerland, including the transfer of associated Relationship Managers and staff who will enable the continuity of the client business.
The transfer of the client assets in Switzerland is expected to be concluded by the end of 2015. At the same time and upon the completion of the agreement, Leumi Private Bank will work to close its business operations in Switzerland, in coordination with relevant authorities.
In addition, the intention of the parties is that Julius Baer will purchase Bank Leumi Luxembourg S.A, including its assets, clients and employees, in exchange for the capital of Leumi Luxembourg. This acquisition is expected to be completed by the end of the first quarter of 2015, subject to regulatory approvals.
At the end of June 2014, Leumi Private Bank had approximately CHF 5.9 billion assets under management (AuM) and Leumi Luxembourg had approximately CHF 1.3 billion AuM.
Rakefet Russak-Aminoach, President and CEO of Leumi: "In recent years we have witnessed dramatic changes in the private banking world, due to the evolving business environment and tightening regulation. We see this period as an opportunity to make vast changes and develop new growth engines. The unique cooperation with Julius Baer is yet another step we are implementing with the aim of adapting ourselves to the new banking era and the evolving regulatory requirements in the global private banking arena"
Julius Baer Group was established 125 years ago and has the largest international presence among Swiss private banks, with over 50 offices located in 25 countries worldwide. Total assets under management of the group exceed CHF 270 billion.