Commerzbank offloads Swiss private bank to LGT, avoiding row with Berlin
GERMANY’S Commerzbank has reached a deal to sell the Swiss private banking arm of Dresdner Bank to Liechtenstein’s LGT Group, the bank that was embroiled in a tax evasion probe last year.
The transaction, at an undisclosed price, will double LGT’s assets under management in Switzerland to just under Sfr20bn (£11.4bn), bringing total assets to around Sfr87bn.
Commerzbank, which took €18bn in state funding, is thought to have earmarked the unit for sale to avoid a row with Berlin, which is keen to clamp down on Switzerland’s status as a tax haven.
German finance minister Peer Steinbrueck hinted earlier this year that he wanted to prevent the country’s state-backed banks from operating in tax havens.
LGT was at the centre of a row over tax evasion last year, when Berlin paid a former employee of the bank to access client data, prompting a flurry of clients withdrawing their funds.
Glen Moreno, acting chair of UK Financial Investments – which manages bank stakes for the UK government – was drawn into the row when it emerged that he was a former trustee of LGT.