BTG Pactual Purchases Swiss Private Bank BSI for $1.29 Billion

BTG Pactual, the only publicly traded investment bank in Brazil, has concluded its purchase of BSI, the Swiss private banking unit of Assicurazioni Generali SpA for $1.29 billion.

Established in 1873, BSI is one of Switzerland’s oldest banks. The Lugano-based bank will keep its name and continue to run independently, BTG said. The combined company will hold $186.5 billion in assets under management.

BTG also stated that Alfredo Gysi would step down as the president of BSI’s board. He will be replaced by Joseph Rickenbacher, effective on Wednesday.

The separation of BSI from Generali was a business strategy. Generali wants to now completely focus on its core insurance business and improve its capital position.

BTG Pactual is looking forward to acquiring more Swiss private banking units.

We are looking. We are always looking, Renato Cohn, a BTG partner and member of BSI’s executive board, said on Tuesday in a telephone interview from Lugano, Switzerland after the Sao Paulo-based firm announced the completion of the BSI transaction. The Swiss bank consolidation process will continue, and we want to be part of that consolidation process.

According to a McKinsey & Co. study, some Swiss private banks are struggling with increasing costs and a crackdown against undeclared offshore accounts, with several facing US criminal investigations related to tax probes. The consolidation of the European private banking industry is inevitable as higher costs cut into profitability.

We are focused on the integration of BSI while we look into buying opportunities, Cohn said.