UPDATE 2-Banque Syz to buy Royal Bank of Canada's Swiss private bank
* RBC sells Swiss arm to Geneva's Syz
* Latest foreign player to leave Switzerland (Adds RBC's remaining activities in Switzerland)
ZURICH, July 14 (Reuters) - Geneva's Syz is buying Royal Bank of Canada's Swiss private bank for an undisclosed sum, a deal that it expects to help more than double its profit from 2017.
RBC becomes the latest foreign bank to leave private banking in Switzerland, where the Toronto-based bank manages 10 billion Swiss francs ($10.6 billion) on behalf of clients who are mainly from Latin America, Africa and the Middle East.
Founded in 1996, Syz is a relative newcomer to the venerable world of Swiss banking. The deal will bring its assets in private banking, where it needs to bulk up to better deal with the costs of increased regulation, to roughly 22 billion francs.
"Of course, the possibility to buy something and hitting the ground running is a much easier development than having to start from scratch," co-founder and Chief Executive Eric Syz told Reuters in an interview on Tuesday.
Such opportunities are more common as foreign players scale back in the face of tighter regulation associated with a series of tax crackdowns. Swiss UBP this year agreed to buy Royal Bank of Scotland's international private banking arm.
Syz said the bank's profit will leap as a result of the deal, helped in part by a new information technology system provided by Swiss specialist Avaloq and outsourcing some functions to B-Source, a Swiss firm which takes on business processes from banks.
"The idea is that starting 2017 the synergies from this should yield at least 30 million francs to the bottom line of the group," Syz said. Continued...