Challenger off-loads HSBC division

Challenger has sold the former HSBC Private Investment Group to Deutsche Private Wealth Management.

Deutsche Private Wealth Management managing director Michael Parsons told Money Management that the three staff in the HSBC unit, headed by Trevor Williams, will transfer to Deutsche and remain in Melbourne.

The move comes five months after Challenger acquired HSBC’s asset management business in Australia.

“We have been looking to grow our presence in Melbourne and broaden our client base,” he said.

“So when Challenger approached us about taking over the business, it fitted in with our growth strategy.”

A spokeswoman for Challenger said the HSBC business had been sold, as it was “non-core to the future growth of Challenger’s Wealth Management business”.

Parsons would not disclose how much Deutsche paid for the business. “There were commercial terms negotiated with Challenger based on a quantum of the assets [held by the HSBC group],” he said.

Currently, the Private Investment Group has $270 million in funds under management, all held in individually managed accounts (IMAs). There are about 100 clients.

Parsons said the IMAs will continue in the new business, but the investment offerings to clients will be broadened, reflecting Deutche’s varied asset base.

“We have been expanding our offerings in the existing advisory business of wealth management, and we are looking at more than $1 billion of funds under advice,” Parsons said.

The former HSBC team will officially transfer to Deutsche in November, and Williams will report direct to Parsons.