By ABN Amro looks set to make another big move in the German private banking sector. According to Börsen-Zeitung sources the Dutch bank, which recently announced the acquisition of Hauck Aufhäuser Lampe, is also preparing to take over the business of Trinkaus & Burkhardt, which is owned HSBC.
The transaction could be announced within the next two to three weeks. A spokesperson for ABN Amro in Amsterdam did not wish to comment.
High pressure to digitalise
The wave of consolidation in the high-end private client segment is being triggered by the increasing pressure to digitalise. The IT investments required for this can only be made by providers that can realise sufficient economies of scale.
In the case of HSBC Continental Europe’s German private banking business, it has been known for some time that the parent company was not willing to make the necessary investments in the non-core German business for strategic reasons. In the 2023 financial year, HSBC Germany reported a pre-tax profit of 44 million euros in this business segment, compared to just 17 million euros in the previous year.
Just barely in the top ten
With assets under management of around 26 billion euros, the old Trinkaus & Burkhardt ranked just inside the top 10 in the industry in Germany at the end of 2023, together with M.M. Warburg and Donner & Reuschel. However, the exact ranking and marketshares are difficult to determine, because each bank defines the customer segment differently. What is certain, however, is that Deutsche Bank and Commerzbank are the two leaders in German private banking.
HVB slips to 4th place
At the end of May, ABN Amro announced its intention to acquire Hauck Aufhäuser Lampe for 672 million euros, and merge it with Bethmann Bank, which it already owns. The transaction, which is to be realised in the first quarter of 2025, would create a wealth manager with assets under management of around 70 billion euros. Head of ABN Amro Germany Hans Hanegraaf said as the deal was announced that it would be enough for a clear third place on the German market. HVB, which belongs to the Italian Unicredit Group, would thus slip to fourth place. HVB does not publish the amount of its assets under management but, according to industry insiders, it was just under 60 billion euros at the end of 2023.
Opportunities for independent asset managers
However, industry insiders firmly believe that should ABN Amro merge three banks it would be accompanied by a loss of customers. At least some private bank clients have deliberately chosen not to go with the major banks. The main beneficiaries of any loss of clients would likely be independent asset managers, who are currently growing faster than the market anyway. ABN Amro could also lose some of its most successful advisors to the competition in the course of the integration process. Liechtenstein-based competitors LLB and LGT Bank, for example, are currently significantly expanding their business in the growing German market. Bethmann has already learnt that they do not shy away from poaching entire teams. Wealthy clients have a reputation for remaining loyal to their advisor rather than their employer.
