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Business deals

Hong Kong boutique bank acquires Italian player

SC Lowy buys controlling stake in Credito di Romagna for 50m euros

Credito di Romagna management team and employees in Forlì, Italy (Photo from company's press release)

HONG KONG -- SC Lowy, a Hong Kong-based boutique investment bank, is expanding further into Europe by acquiring a controlling stake in an Italian bank for 50 million euros ($487 million), it announced on Tuesday.

The deal will give SC Lowy, which specializes in fixed income investment banking, a stake of more than 90% in Credito di Romagna, which has 11 branches in Italy's leading cities and which had total customer loans and deposits exceeding 1.2 billion euros at the end of 2017.

"The acquisition of Credito di Romagna represents an important step forward in the development of our European platform and for the growth of our business," said Michel Lowy, chief executive of SC Lowy.

The Hong Kong bank, which was founded in 2009 by former Deutsche Bank bankers with just 10 employees, has been aggressively increasing its presence beyond Asia. It now has offices in London, Milan and Seoul and has seen transactions of over $65 billion dollars since its inception.

The company started out offering trading loans, involving debts that were distressed or below investment grade. Its businesses now also include primary issuance and secondary trading.

Despite the boutique bank's fast growth, it remains a small operation, with just over 100 employees prior to the acquisition. Lowy said the new resources would enable the Italian bank, based in the north-eastern town of Forli, to strengthen its commercial banking presence in the region, growing more corporate and retail consumers.

"Combined with our credit analysis skills, our network of investment partners and our experience in investment banking, we can help to expand the bank's business with the offer of new services in Italy," Lowy said.

Currently, Credito di Romagna's major clients are local families, self-employed workers and small and medium-sized enterprises.

"The bank can now rely on a long-term strategic partner that enables Credito di Romagna to better support its clients with a wide range of products and services dedicated to both corporates and individuals, enhancing our commitment towards the regional economy," said Maurizio Barnabe, general manager of Credito di Romagna.

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