HSBC has agreed to refer some private-banking clients to rival UBS in an effort to streamline part of the London-based bank’s operations in Latin America.
UBS Wealth Management Americas paid a fee for a portfolio of HSBC Private Bank clients primarily based in Central America and the Andean Pact, according to a memo sent to HSBC employees on Tuesday from Global Private Banking CEO Peter Boyles.
“This decision reflects a refocusing of our strategy on those Latin American markets where we have existing scale in our portfolio, and where we have identified growth opportunities for our Private Banking business, in particular Argentina, Brazil, Chile and Mexico,” Boyles said in the memo reviewed by WealthManagement.com and confirmed by a bank spokesperson.
Up to 40 private-bank employees, including support staff, are expected to be offered roles with UBS as a result of the referral. Those who remain will continue to provide banking and investment management for the remaining core markets.
It has been years since HSBC Private Banking had a physical presence in Latin America. Most of the bank’s clients in those countries work with private bankers located in Miami, and some work with bankers in New York.
The goal is to focus on servicing the needs of individuals who are owners and principals of HSBC’s corporate clientele. Individuals with a need for private banking commonly also seek wealth management services.
The private bank continues to grow within HSBC’s four core countries in Latin America, and no other major referral agreements appear to be on the horizon. In his memo, Boyles wrote that the agreement with UBS “completes the strategic repositioning” of the private bank to better align it with HSBC’s overall footprint. The private bank had clients in 15 other Latin American countries prior to the referral.
UBS had no comment on the referral agreement.