Deutsche Bank AG, Europe's largest investment bank, agreed to sell its U.S. private-client services unit to Raymond James Financial Inc. as co-CEO John Cryan seeks to shrink investment-bank operations and lower costs.
Terms of the deal, which will bring about 200 advisers to Raymond James, were not disclosed. About 400 support staff will also be offered positions, according to a Raymond James statement.
Deutsche's U.S. private-client business, once part of Alex. Brown, was acquired by Deutsche Bank in its purchase of Bankers Trust Corp. in 1999. The $9 billion deal was a record at the time for a foreign purchase of a U.S. investment bank.
Deutsche's private client services' advisers generally specialize in serving sophisticated and high-net-worth clients as well as select institutional investors, and are mostly located in large metropolitan areas.
ALEX. BROWN BRAND
In recognition of its original founding in 1800 under Alex. Brown, the nation's first investment bank, the advisers coming to Raymond James will operate under the Alex. Brown brand.
“There is deep affinity among many advisers for Alex. Brown's history, which is well respected by the industry and investors alike,” Raymond James chief executive Paul C. Reilly, said in the statement. “We are proud to use this opportunity to bind our new colleagues under this historic name.”
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As part of the transaction, Haig Ariyan, co-head of wealth management in the Americas for Deutsche Asset & Wealth Management, will join St. Petersburg, Fla.-based Raymond James along with other executives as part of the deal, according to Raymond James' statement.
The sale doesn't include Frankfurt-based Deutsche Bank's U.S. private bank, which handles some of its wealthiest clients.
Deutsche Bank AG's co-CEO John Cryan, who replaced Anshu Jain this year, is preparing to shrink the investment banking empire built by his predecessors to lower costs, lift capital levels and raise the company's stock price. Mr. Cryan is cutting Deutsche Bank's client list in half, pulling out of countries around the world and scrapping some trading businesses.
“This agreement will allow us to focus on our strategic priorities including investing in our U.S. private bank,” Fabrizio Campelli, Deutsche Bank's global head of wealth management, said in the statement. “The U.S. is a key geographic region for Deutsche Bank's wealth-management business.”
