RBS confirms sale of Coutts International to Swiss bank UBP

The Royal Bank of Scotland has agreed to sell its international private banking arm Coutts International to Swiss private bank Union Bancaire Privee (UBP).

The bank said in a statement that the sale comprises client relationships managed from Switzerland, Monaco, the UAE, Qatar, Singapore and Hong Kong, but outside the British Isles.

The price paid will be determined in part by assets under management on closing, the bank said. As at 31 December 2014, assets under management for the division were about CHF32bn (£22.4bn, €30.5bn, $33.4bn) and total risk weighted assets were CHF2bn. The bank anticipates receiving a premium on the deal.

The Financial Times had earlier reported UBP was expected to pay about $600m to $800m, citing two people familiar with the situation.

"Last year we set out a clear strategy to create a truly UK-focused bank. This announcement is another important step in that process. Following an extensive review, it was clear that the bank we are building would not be the most appropriate owner of the business being sold," said Alison Rose, CEO of Commercial & Private Banking at RBS.

"We gave careful consideration to identifying a buyer with the capability to take on this business in order to minimise the impact on clients and staff. We believe that in UBP we have found a good long term owner for this business."

RBS will continue to service UK private banking and wealth management client needs, together with those of international clients with a strong connection to the UK, from the British Isles through its Coutts and Adam & Company brands.

"Our private banking brands are integral to RBS, supporting our ambition to make this the number one bank for customer service, trust and advocacy in the UK," Rose said.

Initial closing of the transaction is expected in the fourth quarter, when bulk of the business is expected to be transferred, with the remainder taking place during the first part of 2016.The transaction is subject to regulatory approvals.

RBS added that its capital benefit from the transaction was expected to be modest after writing off goodwill related to the business and taking into account anticipated exit and restructuring costs. As a result of the sale, the company expects to take a goodwill write-off charge of £200m in the first quarter results.