RBS sells Indian private banking business to Sanctum Wealth management

Edinburgh headquartered Royal Bank of Scotland signed an agreement to transfer the India private banking business to Sanctum Wealth Management.
RBS did not give financial details of the deal but it is expecting to be around Rs 200 crore. The wealth management arm of RBS has assets of nearly Rs 12,000 crore under management which will now be under the control of Sanctum.

• The deal comprises transfer of client relationships and staff.
• Existing branches of RBS in Mumbai, Delhi, Chennai and Bengaluru will also be retained by Sanctum.
• The transfer of the business to Sanctum is expected to be completed by the end of first quarter in 2016 after getting the regulatory approvals.

Sanctum is a Mumbai based company that will be led by Shiv Gupta who heads the private banking business at RBS India and the existing management team.
REASON BEHIND SELL OFF

• This decision to sell off the private banking business in India comes a few months after the management decided to exit the Indian market. The management had decided that it would look at consolidating its position in Britain.
• At the end of December 2014, the net balance sheet exposure of the operations in India fell by £1.7 billion to £2 billion. This shrinking came on the back of reductions in corporate lending, particularly in the oil and gas and mining & metals sectors, and in lending to banks, largely trade finance.

In March, RBS had also announced it would be selling off its internationally managed private banking and wealth management business to Union Bancaire Privee (UBP). This business included operations managed out of Switzerland, Monaco, UAE, Qatar, Singapore and Hong Kong but did not include the India business.