Julius Baer, the Swiss banking firm, is apparently in advanced negotiations to buy Bank of America‘s overseas wealth management operation for about $2 billion according to what a source told CNBC.
The Julius Baer Group is in the picture because Bank of America decided to put the non-domestic wealth unit (which the exception of the Japanese division) up for sale in April. As previously reported by Reuters, “the business, which manages some $90 billion for rich clients, is not large enough to generate enough money for the U.S. bank.”
Negotiators are reportedly in the process of putting the finishing touches on the transaction.
Neither Julius Baer nor Bank of America have made an official comment but the CNBC source thinks it’s a good deal.
Purchasing the Bank of America (BAC) division would significantly increase Baer’s size and scope, this person adds, adding particular strength in Asia and Latin America.
Bank of America has been in the midst of a cost-cutting, cash-raising mode in the past year, Reuters explains:
Bank of America has been selling off non-core business units under Chief Executive Brian Moynihan to build capital. The second-largest U.S. bank by assets has trailed rivals in recovering from the financial crisis, largely because of huge losses and lawsuits tied to its 2008 acquisition of subprime mortgage lender Countrywide Financial.
The Julius Baer Group is said to be Switzerland’s largest private bank with assets under management of about $187 billion. U.S. authorities apparently have been investigating the Julius Baer Group over the past few years for allegedly helping U.S. citizens hide their assets from the IRS.