BNP Paribas Securities Services (BNP Paribas) has acquired Banco Popular’s depositary banking business in Spain for an undisclosed amount. The transaction is expected to close in early summer 2014, subject to regulatory approval.
Banco Popular is one of Spain’s largest depositary banks with €13bn ($18bn) in assets held under depository, which includes investment funds, pension funds and Sicavs managed by Allianz Popular and Popular Banca Privada, as well as EPSVs (Basque pension plans).
Following completion of the acquisition, BNP Paribas Securities Services will be the depositary bank for Spain’s fifth largest asset manager Allianz Popular, which has €13.2bn ($18.3bn), including mathematical provisions, in assets under management.
The buyout continues the expansion of BNP Paribas’ depositary bank business in order to help clients meet requirements under EU Alternative Investment Fund Managers (AIFM) directive and Ucits, which mandate managers of AIFs and Ucits to appoint a single independent depositary bank to carry out various safekeeping functions for the underlying funds. As such, many custody banks have expanded or introduced depositary bank businesses in order to capitalise on this new business opportunity.
The custodian recently extended the business to the Netherlands and Switzerland and last year acquired Commerzbank’s German “depotbank” business.
An important consideration in the transaction was the bank’s ability to meet the operational requirements of Allianz Popular, according to the statement.
“This transaction with Banco Popular, one of Spain’s leading universal banks, highlights our long-standing commitment to the Spanish market and marks an important milestone in the expansion of our European depositary business,” said Alvaro Camuñas, head of BNP Paribas Securities Services Spain, Portugal and Latin America.
“It will reinforce our local expertise and is part of our strategy to provide market-leading solutions for our and Ucits clients in Europe and around the world.”
“We have been working closely with Banco Popular since 2011 when we were appointed as its back office outsourcing provider. This acquisition is a testament to our strong relationship with Banco Popular and we look forward to further cooperation with them.”