ATRAM consolidating domestic trust industry

The ATRAM Group appears to be consolidating the trusts industry. InsiderPH broke the news that Metrobank [MBT 79.45, up 5.2%; 106% avgVol] is selling its entire stake (a 70% controlling interest) in First Metro Asset Management (FAMI) to the ATRAM Group in a deal that has not yet closed and is still subject to closing conditions. No financial terms were disclosed. The other piece of news was that Union Bank [UBP 37.75, up 3.3%; 44% avgVol] and the ATRAM Group are in discussions to merge their trust businesses, with the ATRAM Group as the surviving entity and UBP as a significant investor in the ATRAM Group. 

MB bottom-line: ATRAM is in the trusts and wealth management business, which handles investments on behalf of its wealthy clients under a variety of different schemes and service levels. While most banks have an internal division that caters to clients with generational wealth, some have struggled to grow their trusts and wealth management divisions for a wide range of reasons, and these moves might be signs that the banking industry is looking to move away from some of its non-core business lines to focus on areas that are more profitable. I don’t have a lot of experience with this industry, both because my family doesn’t have the kind of generational wealth required to grow up with first-hand knowledge of the wealth management ecosystem, and because my professional life rarely crossed from the financial needs of the companies I represented into the individual needs of the private portfolios of the people I worked for. If there are any analysts out there with a good grasp on these transactions and how they might impact the wealth management sector and regular people going forward, please reach out because I’d love to showcase your thoughts!

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