GENEVA - British bank Barclays could acquire a wealth management business at least the size of Julius Baer to meet its target of ranking in the top five private banks globally, Barclays Wealth's vice chairman said on Wednesday.
Speaking at the Reuters Global Wealth Management Summit in Geneva, Gerard Aquilina said the group would be prepared to acquire an entity the size of Julius Baer or bigger, to reach the target set by the unit's Chief Executive Tom Kalaris earier this year.
There could be a major transformational buy for us, he said.
JP Morgan, ranked as the fifth-largest wealth manager, has $600 billion in assets under management. Barclays Wealth currently manages 145 billion pounds ($230.1 billion). With its newly struck ING acquisition in Switzerland, Julius Baer will have 160 billion Swiss francs ($155.2 billion) under management.
Aquilinas also noted that organic growth remains a priority for the group, which has rapidly expanded its global wealth management business since acquiring the U.S. businesses of Lehman Brothers last year.
Barclays has taken a major bet on private banking in the hope that synergies with other units such as investment banking will give it a competitive edge in an industry battered by rocky markets and fallout from the Madoff scandal.
I have seen situations since January where we have assisted clients in commercial real estate and assisted in financing and sourcing deals where the commercial bank, private bank and investment bank were all involved, Aquilinas said.
But he said the bank would be highly selective in choosing acquisition targets.
Being big for the sake of being big is not necessarily a good philosophy to enhance shareholder value, he said.
Aquilinas also said the bank is investing heavily in recruitment for the wealth management business and is in talks with top-tier academic institutions over the launch of an MBA-level course tailored for private banking.
Barclays wants to attract greater talent to wealth management, which in the past has struggled to compete with investment banking to attract high quality graduates.
($1=1.03 Swiss francs)
(Editing by Greg Mahlich)