Netherlands-based ING said on Friday the sale, which is in line with its strategy to focus on fewer franchises and reduce the group's complexity, will give it an estimated net profit of approximately 300 million euros ($421 million).
The new unit will be called Bank of Singapore Ltd and will be led by Renato de Guzman, former head of ING Asia Private Bank, OCBC said in a statement.
Guzman said in a statement the private bank plans to grow and capture greater market share in existing and new markets.
Oversea-Chinese Banking Corp agreed to buy the ING unit for $1.5 billion in October last year in a deal which would elevate it to Singapore's second-ranked bank by assets.
ING said it will continue its private banking activities in China through its stake in Bank of Beijing, in India through ING Vysya Bank and in Thailand through TMB Bank.
Its private banking activities in the Benelux and in central and eastern Europe belong to its core businesses, it added.
OCBC beat HSBC Holdings Plc in the bidding and the deal helped more than triple its private banking assets to $23 billion.
FOCUS ON SOUTHEAST ASIA
With the acquisition, OCBC now has 200 private bankers and may add another 30, Guzman said at a news conference.
We have all the elements to be able to build Asia's global private bank, he said. First goal is to be number one in our home market -- Southeast Asia.
Guzman said the new unit wanted to grow its business in Hong Kong and Taiwan and build a stronger onshore private banking business in China. The private bank also plans to expand in the Middle East and Europe, he said.
OCBC chief executive David Conner said the private bank would be earnings accretive this year and will boost its return on equity. Asia's exceptional economic growth and savings rates will no doubt generate a surge of private wealth creation,.
OCBC shares closed down 1.9 percent, underperforming the benchmark Singapore market which closed down 0.5 percent. ING shares were up 1.9 percent at 1046 GMT, slightly outperforming the DJ Stoxx banking index .SX7P, up 0.7 percent.
(Editing by David Holmes and Louise Heavens)