(Reuters) – French bank Credit Agricole and Spanish lender Santander plan to combine their custody and asset servicing operations in a deal that would create a new global leader, the companies said on Wednesday.
The new entity would have about 3,340 billion euros in assets under custody and about 1,833 billion euros in assets under administration, the lenders said in a joint statement.
Credit Agricole will own a bulk of the merged unit, which will keep the brand name of Agricole’s existing asset management arm – CACEIS.
The French bank will own 69.5 percent, while Santander would hold 30.5 percent. Santander’s ‘S3’ Securities Services arm in Spain and Latin America would also be combined with CACEIS.
“We are delighted to enter into this partnership with Credit Agricole,” said Santander Chairman Ana Botin.
“S3 and CACEIS are highly complementary businesses, and by working together we can create a custody and asset servicing platform that leverages our collective scale and global presence, and offers clients a comprehensive service that can support their ambitions and help them to prosper,” Botin added.
The deal between the banks comes as European banks face a possible phase of consolidation as companies look to cut costs and strengthen their market positions.
Germany’s Commerzbank and Deutsche Bank are in merger talks, but Italy’s Unicredit has also said it could explore a deal with Commerzbank, while a German magazine said ING had also approached Commerzbank.
(Reporting by Sudip Kar-Gupta; Editing by Clarence Fernandez and Sherry Jacob-Phillips)
