Asset manager Schroders and Lloyds Banking Group said on Sunday they were in discussions over a wealth management alliance.
The deal would be among the biggest wealth management tie- ups in recent years and would come amid widespread consolidation in the broader industry sector.
Schroders spokeswoman Beth Saint confirmed the move after Sky News reported that Lloyds was to merge its 13 billion pound ($17 billion) wealth management arm into a new joint venture with Schroders.
“Schroders confirms that it is in discussions with Lloyds Banking Group plc with a view to working closely together in parts of the wealth sector,” Saint said in an email to Reuters, adding there was “no certainty that these discussions will lead to any formal arrangement being entered into.”
Lloyds Banking Group issued a similar statement, saying any further announcement “will be made at the appropriate time.”
Sky News reported that the deal would see Lloyds owning 50.1 percent of the joint venture, with Schroders owning the rest, Sky News said, citing sources.
Wealth management contributed 273.3 million pounds to Schroders’ net income in 2017 and has been an area of focus for future growth.
Sky News said the new joint venture would be part of a three-pronged tie-up between the companies.
It would include Schroders taking on a 109 billion pound investment management contract from Lloyds-owned Scottish Widows that is the subject of a disagreement with Standard Life Aberdeen, which previously managed the money.
The mandate was pulled from SLA after Lloyds said the 2017 merger of insurer Standard Life and Aberdeen Asset Management meant the enlarged company had become a material competitor.
The dispute remains in arbitration.
The third leg of the Lloyds-Schroders deal involves wealth manager Cazenove Capital, Sky reported.