The consolidation in Switzerland's asset management industry continues. Vontobel will assume a Raiffeisen unit to strengthen its own business. The relationship between the two institutes thus is taking another turn.

Vontobel has agreed to buy Vescore, the asset management unit of Raiffeisen Group, the companies said in a statement today. They didn't disclose the price of the transaction. Vescore has 15 billion Swiss francs in assets under management.

The transaction is part of the partnership agreement that Vontobel and Raiffeisen signed in February 2016. Raiffeisen will focus on providing comprehensive service and advice to its clients in the investment business.

Profitable by 2018

Vontobel on the other hand is complementing its asset management boutique model by adding Vescore. It will enable the bank «to further expand its existing investment capabilities in the areas of sustainable investing and quantitative investing in particular,» Vontobel added in the statement. «Furthermore, Vontobel Asset Management will strengthen its overall presence in its Swiss home market as well as in the institutional business in its focus market Germany.»

Vontobel will finance the acquisition out of own funds. After completing the integration, the bank expects the unit to contribute to profit by 2018. The bank's capital ratio will exceed 16 percent, its own target, after the acquisition.

Cooperation – Conflict – Cooperation

The agreement would have been impossible only a year ago. Vontobel and Raiffeisen embarked on a bitter conflict starting in 2013, after Raiffeisen had bought the former Wegelin private bank and a stake in Leonteq. Vontobel was convinced that these moves violated their cooperation agreement of decades back and they subsequently agreed to terminate the pact by 2017. Raiffeisen sold its Vontobel stake and started buying asset-management boutiques.

On Friendly Terms Again

TCMG was at the heart of the new group, led by Beat Wittmann. In 2014, TCMG became the asset-management unit of Notenstein. Last year, the asset management became an independent unit again and was renamed Vescore.

After the departure of Pierin Vincenz as CEO of Raiffeisen, the two banks put their differences behind them and in February of this year they even extended the cooperation agreement until the end of 2020.