EFG International and BTG Pactual have finally reached an agreement on the eventual price for BSI. Who gave in?
The Swiss private bank EFG International has received 89 million Swiss francs for the purchase of the Ticino financial institution Banca della Svizzera Italiana (BSI), much less than had been expected.
Lugano, Switzerland-headquartered BSI had been deeply entrenched in the money-laundering scandal surrounding the Malaysian state fund 1 MDB. Its Singapore unit closed down by the local regulator. The bank was in the process of being acquired by rival EFG when the scandal hit last May.
Zurich-based EFG said on Monday it agreed with BSI's former owner, Brazlian BTG Pactual, on a 971 million franc selling price for the Ticino private bank.
Big Rebate?
Last October, the price had still been valued at 1.06 billion francs, but without a definitive agreement. EFG had argued for a dramatic rebate: the bank had still factored in a discount of 279 million francs in its annual report for last year.
With BSI reeling following the Singapore shuttering, BTG Pactual went for a firesale , particularly as the then-owner itself was involved in a corruption affair in Brazil.
EFG said the deal will reduce its capital ratio by roughly one percentage point. The bank reports half-year results next Wednesday.
