Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

UBS steps into 'Gen Z' push with $1.4 billion Wealthfront buy

Stock MarketsJan 27, 2022 06:25AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. FILE PHOTO: The logo of Swiss bank UBS is seen at the company's office at the Bahnhofstrasse in Zurich in this July 1, 2009 file photo. REUTERS/Arnd Wiegmann/Files

By Michael Shields and Brenna Hughes Neghaiwi

ZURICH (Reuters) - UBS has agreed to buy California-based digital wealth management start-up Wealthfront in a $1.4 billion all-cash deal, as the Swiss bank targets younger tech-savvy investors in the United States.

UBS said it would make Wealthfront's capabilities "the foundation" as it seeks to grow business amongst the 130 million millennial and Gen Z investors in the United States who will "own an increasing share of the world's wealth".

The acquisition marks the first major deal in Chief Executive Ralph Hamers' bid to reach customers outside UBS's super-rich core client base - made up primarily of billionaires and multi-millionaires - by upping digital services.

One of the largest digital wealth management firms known as "robo-advisers", Wealthfront caters primarily to millennial and Gen Z investors, and currently counts around half a million clients in the United States, the two firms said.

It manages more than $27 billion in assets, having added cryptocurrencies and socially responsible investing into the mix in 2021.

"Adding Wealthfront's capabilities and client base to our global investment ecosystem will significantly boost our ability to grow our business in the U.S.," Hamers said in a joint statement on Wednesday.

UBS in October outlined a push to lure in more affluent clients in America by building up a digitally scalable advice model, as the bank sought to increase its share in its biggest wealth market.

The world's number one wealth manager is set to unveil the results of Hamers' broader strategic review when it reports results on Feb. 1. Hamers became CEO in November 2020 following a successful stint digitalising Dutch lender ING.

The Wealthfront purchase, set to close in the second half of 2022, follows UBS' roll-out of a 'hybrid' platform blending digital and personal advisory services in Europe and Asia, launched in 2020 to quick uptake.

Wealthfront will become a wholly owned subsidiary of UBS and will operate as a business within UBS Global Wealth Management Americas, the companies added.

"If successful, we believe UBS could roll out the model on a global scale," Vontobel analyst Andreas Venditti said.

Joining up with UBS will let Wealthfront offer clients more services and research, its CEO David Fortunato said. "We couldn't be more excited to have found a strategic partner who has the same view on the power of technology," he added.

The purchase follows a trend set by U.S. rivals Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS) in looking to broaden their client bases beyond the super-high-net-worth individuals they traditionally served.

UBS said it would finance the deal with excess capital.

The companies said UBS Investment Bank is acting as financial adviser to UBS, and Sullivan & Cromwell as legal counsel. Qatalyst Partners is Wealthfront's financial adviser, and Fenwick & West is acting as legal counsel.

UBS steps into 'Gen Z' push with $1.4 billion Wealthfront buy

Related Articles

AMC Slips After Taking Stake in Cinema Ad Company
AMC Slips After Taking Stake in Cinema Ad Company By - May 18, 2022

By Liz Moyer -- AMC Entertainment Holdings Inc (NYSE:AMC) shares slipped 1.6% after disclosing it acquired a 6.8% stake in National CineMedia. Shares of National...

Dollar gains as inflation fears spark stock rout
Dollar gains as inflation fears spark stock rout By Reuters - May 18, 2022 8

By Herbert Lash NEW YORK (Reuters) - Global stocks tanked and the dollar strengthened on Wednesday as concerns about economic growth and rising inflation soured sentiment. The...

France's Societe Generale closes Rosbank sale
France's Societe Generale closes Rosbank sale By Reuters - May 18, 2022

PARIS (Reuters) - Societe Generale (OTC:SCGLY) said on Wednesday it had closed the sale of its Russian business Rosbank to the Interros group, a firm linked to Russian oligarch...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Deon Stewart
Deon Stewart Jan 26, 2022 1:56PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Will UBS take on crypto invested clients? Or maybe cash in our crypto to invest with UBS?
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
Sign up with Email