NAB Singapore private wealth sold

May 2017 - AU Mortgage News

Australia or Singapore banks

OCBC Bank on Thursday (May 11) announced it has entered an agreement to acquire National Australia Bank’s (NAB) private wealth business in Singapore and Hong Kong.

According to the Singapore bank’s press release, the purchase price will be at around the book value, or net asset value, of the business at the time of the completion of the deal.

As at end February 2017, the business comprised a mortgage portfolio amounting to about US$1.7 billion (S$2.39 billion) worth of mainly residential mortgage loans, and a deposit portfolio made up of about US$3.05 billion (S$4.28 billion) worth of deposits of a mix of currencies, OCBC said.

The bank said the deal will allow it access to about 11,000 new customers – more than 7,000 in Singapore and about 4,000 in Hong Kong. The addition of US$1.7 billion of mortgage loans will also increase the overall size of OCBC’s mortgage portfolio by about 4 per cent, based on its mortgage loans book of S$60 billion as at end March 2017.

“This deal makes financial and strategic sense to us. A mortgage loans book of more than S$2 billion is not small. It would have taken us time and money to grow our mortgage loans organically by that amount. We are now getting an immediate boost to our mortgage loans book,” said OCBC’s COO Ching Wei Hong.

The transaction, expected to be completed before the end of the year subject to regulatory approval, is not expected to have a material impact on OCBC Bank’s capital position.

NAB’s general manager for Asia (ex-Greater China) Neil Parekh added that it will work closely with the Singapore bank during the transition to completion to ensure a smooth process.

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