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StanChart to acquire 49 per cent in UTI securities for Rs140 crore

Standard Chartered Plc. is in final talks to buy a 49 per cent stake in Indian brokerage UTI Securities, a deal that would help the banking conglomerate expand its wealth management services for customers in India, the Financial Times reported.

The transaction, expected to cost Rs140 crore ($35 million), marks Standard Chartered's return to retail stock broking in Asia after more than a decade, the report said.

UTI has about 40 branches and Rs70 crore in annual revenue.

Reports said G. Narayanan, managing director at Securities Trading Corp. of India Ltd., UTI's parent, confirmed the talks were advanced, but declined to discuss the value of the deal.

Standard Chartered's existing wealth management business, which caters to individuals with investable assets of below $1 million, is growing strongly. This business contributed nearly $2 billion in revenue last year, or 40 per cent of consumer banking business.

StandardCharterd's new private banking business, headquartered in Singapore, caters to customers with $1 million to $50 million.

As part of its expansion, Standard Chartered would hire 200 to 300 private bankers worldwide over the next two to three years, bringing the total to between 350 and 450 by the year 2010.

Standard Chartered and other banks are increasingly focusing on the private banking business because of the rapid rise in the number of wealthy individuals, particularly in Asia. The sector is currently dominated by big players, including UBS, Citigroup, and HSBC.

Source : Domain B

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