The development of the asset management division has been a worry for UBS, Switzerland's biggest bank. The company now has decided to sell the fund administration to a buyer in the U.S. to improve efficiency.
UBS has agreed to sell the fund administration based in Switzerland and Luxembourg to U.S.-based Northern Trust, the company said in a statement today. The Swiss bank expects the sale to increase efficiency and effectiveness.
The sale affects all Swiss and Luxembourg-based units, which provide fund administration services at UBS Asset Management. The company didn't say how much it will receive for the divested units.
Relationship Managers Stay Put
Northern Trust will provide administration services for funds with assets worth 420 billion Swiss francs after the takeover.
The funds include traditional UBS Asset Management funds, which currently receive their administration services from UBS Fund Management (Switzerland) and UBS Fund Services (Luxembourg).
UBS customers will retain their current client relationship managers and UBS Asset Management will continue to offer management company, white labelling and representative services to its clients.
Leading Administrator in Switzerland
UBS and Northern Trust expect the transaction to be concluded in the second half of 2017, subject to the approval by the regulator and the fund board approvals.
With the takeover of the fund administration, Northern Trust will gain local fund administration capabilities in Switzerland and make it a leading administrator by assets. In Luxembourg, the company has already been present.
Sluggish Development
«This move will enable us to further focus our efforts on helping clients address their global investment challenges, while ensuring their fund administration needs continue to be well served,» said Ulrich Koerner, head of UBS Asset Management.
UBS aims to make asset management an important pillar within the group. But the division has been lagging expectations with sluggish growth for years.
