Generali’s BSI Lures Brazilian, Chinese Bidders: Sources

By Sophie Sassard | January 22, 2013

Brazilian-Swiss bank Safra and a Chinese bank are among the three bidders for Generali SpA’s Swiss private bank, BSI, in a deal worth€ 2 billion ($2.668 billion) that could help the Italian insurer shore up capital levels, two people familiar with the situation said on Friday.

The Italian insurer, led by new CEO Mario Greco, aims to raise €4 billion ($5.336 billion) from asset sales to meet new industry rules on capital buffers.

Safra, a Chinese bank and a European consortium made up of a bank and private equity firm have made non-binding offers and are now reviewing BSI’s accounts, the person said.

One of the people said the Chinese bidder was Industrial and Commercial Bank of China (ICBC).

“We see a lot of interest, but we are also aware it is a tough sale,” said one of the sources, who declined to be named because the talks are private.

“It is difficult to predict how the process will evolve when you have interested parties from distant regions who do not necessarily have expertise in private banking.”

Safra and Generali were not immediately available for comment.

Europe’s third-largest insurer bought BSI just before the financial crisis and has been trying to sell it for more than two years.

Price had so far been the main sticking point since potential buyers believed BSI was worth less than its book value of CHF2.3 billion ($2.46 billion, €2 billion), two people working for possible suitors said.

Emerging country players are showing a growing appetite for wealth management assets as their well-off clients seek a “safe haven” for their money in Western countries, especially in places such as Switzerland and Luxembourg, one of the people said.

Japanese firms Mizuho Bank Ltd and Sumitomo Corp, a Chinese private equity fund and Middle Eastern players in Qatar and Abu Dhabi have also shown interest in BSI, but have not made offers so far, one of the sources said.

Safra already paid CHF 1.04 billion ($1.07 billion) to take control of its Swiss rival, Sarasin, last year, beating Julius Baer, Switzerland’s third-largest listed bank.

The Qatar Royal family teamed up with Luxembourg to buy bailed-out Dexia SA’s private banking arm for €730 million ($973.8 million) in 2011.

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