Billionaire Safra's Swiss Bank Could Make ‘Large’ AcquisitionBy
Safra Sarasin could buy manager half its size, chairman says
Managed assets surpass medium-sized rivals after buying spree
Billionaire Joseph Safra’s Swiss private bank has the owner’s blessing to pursue a big deal after surpassing local banking rivals, according to Chairman Ilan Hayim.
"We would not have a problem buying a large entity," Hayim, head of Bank J. Safra Sarasin, said in an interview in Zurich. "Let’s not exaggerate, but for an entity with assets under management of 50 billion Swiss francs ($53 billion) to 100 billion francs -- it’s not a financial issue."
An increase of 100 billion francs in assets would catapult Safra’s banking empire, which includes U.S. and Brazilian businesses, from number 20 into the top 15 of private banks globally. It would leapfrog the operations of HSBC Holdings Plc and Deutsche Bank AG, ending up slightly below Julius Baer Ltd., rankings by Scorpio Partnership show.
The Safra international banking group was founded in the Syrian city of Aleppo in the 19th century and acquired Switzerland’s Bank Sarasin in 2012. Since then, the company has made an average of one acquisition a year, Hayim said. Safra Sarasin on Wednesday said assets under management grew to 170 billion francs, edging out medium-sized rivals including Vontobel Holding AG and Lombard Odier. They are still dwarfed by managers such as Credit Suisse Group AG and UBS Group AG.
"Clearly if we want to jump into this league of the wealth managers who are ahead of us, we have to make an acquisition, or several smaller acquisitions," Hayim said. He said he has the support of Safra, whose sprawling empire also includes London’s Gherkin tower.
The bank is looking at many potential deals and the risk profile and quality of staff at the target are important factors to avoid jeopardizing existing assets, Hayim said. Still, a large acquisition is "not an obsession," and the bank can count itself happy with its growth so far, he said.
Potential acquisitions are "certainly not limited to Switzerland" and could include private-banking assets in Asia or asset-management deals, Hayim said in the interview. The bank will continue to review opportunities because it doesn’t pay dividends and needs to reinvest the 300 million to 400 million Swiss francs it makes in annual profit, he said.
The bank bought Credit Suisse’s private-banking businesses in Monaco and Gibraltar in 2016 and Morgan Stanley’s Swiss private bank the year before. The company is part of a network of banks also spanning the U.S. and Brazil controlled by Joseph Safra, Brazil’s second-richest individual, who is worth about $19.4 billion, according to the Bloomberg Billionaires Index.
"We have this appetite, we have the means, and we will not stop,” Hayim said. “That’s for sure."
Safra Sarasin hired about 100 relationship managers last year across Asia, Middle East and Europe, mostly from larger competitors, he said. The company employed around 2,200 staff at the end of December.