Swiss private bank EFG International (EFGN.S) will proceed with its planned initial public offering in Switzerland of its structured products business in the fourth quarter, subject to market conditions, as the parent company overhauls to renew focus on private banking.
The move will reduce EFG International's stake in EFG Financial Products Holding AG to not less than 20 percent from 57 percent now, helping to strengthen the private bank's capital.
EFG International is undergoing a radical overhaul, axing offices in the Swiss cities of Sion and Lugano, selling its fund administration business to Credit Agricole (CAGR.PA) arm CAECIS, and offloading EFG Bank Denmark to SEB Wealth Management (SEBa.ST).
EFG International said in a statement the IPO was in line with a business review announced last October and would take place on the Swiss exchange.
Zurich-based EFG Financial Products said it has grown to become Switzerland's second largest issuer of exchange-listed structured investment products since it was established in 2007, with a market share of 21 percent.
It has over 270 employees worldwide with offices across Europe and in Hong Kong and Singapore and had a net profit of 10.4 million Swiss francs ($11.11 million) in the first half of 2012, up from 4.1 million a year ago.
"EFG Financial Products plans to generate further growth based on various initiatives, such as selective international expansion, as well as broadening and deepening its product range," it said in a separate statement.
It said the planned IPO should also raise new capital for EFG Financial Products.
Credit Suisse (CSGN.VX) is acting as global coordinator and bookrunner for the IPO, while Vontobel (VONN.S) and Credit Agricole are co-lead managers. Rothschild is independent financial advisor to EFG International and EFT Financial Products. ($1 = 0.9365 Swiss francs)
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