Julius Baer to acquire ING Swiss private bank for $505 million

Swiss bank Julius Baer Holding AG today said it had struck a deal to acquire Dutch ING Groep NV's (ING) private bank in Switzerland for $505 million in cash in order to strengthen its business in Geneva.

Zurich-based Julius Baer Holding AG, established in 1890 and one of the largest dedicated wealth managers in Switzerland, said that that it has reached an agreement to acquire ING Bank (Switzerland) Ltd. ('ING Bank') for CHF 520 million in cash, including surplus capital of CHF 170 million based on a target Tier 1 ratio of 12 per cent.

At the end of August 2009, ING Bank, which had CHF 15 billion in assets under management, will add 10 per cent to Julius Baer's overall private client assets and double its presence in Geneva.

Raymond Baer, chairman of Julius Baer, said, "Julius Baer is taking advantage of current market developments in acquiring a high quality, profitable asset with a strong track record. The client base is similar to the one of Julius Baer and ING Bank's employees share the same client-centric passion, making it a true cultural fit.''

Julius Baer said that the acquisition will be fully funded by existing excess capital, leaving it with a pro forma BIS Tier 1 ratio of about 16 per cent, and the surplus capital of ING Bank will be absorbed in Julius Baer.

The transaction is estimated to bring pre-tax synergies of CHF 35 million annually primarily due to the integration of the different IT and back-office operations as well as streamlining of staff functions.