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Highlights
- Commonwealth Bank's sale transfers $5 billion in assets to LGT Crestone.
- The deal aims to enhance private banking services for high-net-worth clients.
- LGT Crestone welcomes Commonwealth Private’s advisers and support staff.
Commonwealth Bank of Australia (ASX:CBA) has officially exited its financial advisory services for ultra-high-net-worth clients, transferring its Commonwealth Private business to global wealth management firm LGT Crestone. The move involves a $5 billion portfolio in funds under management, marking a significant shift as CBA focuses more intensely on private banking services in Australia.
The deal, initially reported by the Australian Financial Review, is set to finalize by mid-2025. CBA will continue to provide financial advice until then, ensuring a smooth transition. LGT Crestone has extended employment offers to Commonwealth Private’s advisers and support staff, which will help to maintain service continuity for existing clients.
This exit follows a prolonged sales process, where interested parties included names like Morgan Stanley and Macquarie. Ultimately, CBA aimed to sell to a firm specializing in wealth management to better serve its high-net-worth clients. Retail bank chief executive Angus Sullivan emphasized the bank’s ongoing dedication to providing premium private banking services tailored to this client segment.
The sale occurs amid heightened competition in Australia’s wealth management market, as global firms position themselves to capture the interest of affluent Australians. For instance, UBS, which re-entered Australian wealth management after acquiring Credit Suisse, and HSBC, which has moved private bankers from Singapore to Australia, are both expanding their local presence. Goldman Sachs’ CEO in Australia also recently highlighted the growing importance of catering to ultra-wealthy clients in the region.
With the acquisition of Commonwealth Private, LGT Crestone gains around 500 high-net-worth clients, along with a portfolio of $5 billion in assets. LGT Crestone CEO Michael Chisholm highlighted the alignment between LGT and Commonwealth Private in their commitment to delivering a client-focused wealth management experience. Chisholm also noted that the deal allows LGT Crestone to leverage its expertise in private wealth management to enhance service delivery to these sophisticated clients.
The transaction aligns with LGT Group’s strategic objective to strengthen its presence in Australia. Prince Max von Liechtenstein, chairman of LGT, emphasized the importance of supporting clients with a stable and secure wealth management partner as they navigate complex financial landscapes. The acquisition reinforces LGT’s long-term commitment to high-net-worth clients in Australia.
By expanding its footprint in Australia, LGT Crestone aims to provide these clients with access to international expertise and a highly personalized approach to wealth management.
