ZURICH (Reuters) - U.S.-based Northern Trust (NTRS.O) is buying UBS Group’s (UBSG.S) UBS Asset Management fund administration servicing units in Luxembourg and Switzerland, UBS said in a statement on Monday.
Financial terms were not disclosed.
Northern Trust will become the fund administration services provider for UBS funds with about 420 billion Swiss francs($418.91 billion)in assets.
UBS clients will continue to work with their existing relationship management teams, it said.
Northern Trust is expanding in Europe, while UBS said shifting the administration of its funds to another company would boost efficiency.
In 2015, UBS sold its Alternative Fund Services (AFS) business in the Cayman Islands to Mitsubishi UFG Financial Group (8306.T).
Analysts from Zuercher Kantonalbank said fund administration is a “commodity business” where size is the most important factor.
“It makes no sense for UBS to tie up resources in this business,” analyst Javier Lodeiro wrote in a note to investors. “Even so, Monday’s transaction has neither the dimensions nor the strategic significance to have an impact on UBS shares.”
Reporting by John Miller; editing by Jason Neely