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Private bank sale halted by regulator

Tuesday 15 March 2011 by Gina Le Prevost

A proposed private banking arm sale between Belgian firm KBC and the Indian group Hinduja has been blocked by sector regulators, potentially impacting those in private banking jobs at both firms.

The sale of KBC'S private banking arm to Hinduja, which would have been worth some €1.35 billion (£1.17 billion), did not get the green light from CSSF, the Luxembourg financial markets regulator.

According to the Wall Street Journal, in order for the private banking deal to have gone ahead, KBC would have had to secure antitrust clearance from Luxembourg and a further nine nations.

Following the rejection, KBC said it will now "thoroughly assess" its options.

No details were given on the reasons for the deal rejection, but the firm's group chief executive Jan Vanhevel said there is "no denying" it is a disappointing result.

French bank BNP Paribas announced earlier this week that it is to merge two fund management units, in other banking news reported by Reuters.