* UBP to pay initial 65 million pounds
* Additional 35 million dependent on performance
* Lloyds focusing on domestic lending
* Lloyds also sells Miami private banking unit to Sabadell
* Adds to Swiss wealth manager's recent deals
By Martin de Sa'Pinto and Matt Scuffham
ZURICH/LONDON, May 29 (Reuters) - Union Bancaire Privee(UBP) is buying Lloyds Banking Group Plc's international private banking arm, as the bailed-out Britishlender focuses on its domestic market and the Swiss wealthmanager builds on a recent acquisition spree.
Geneva-based UBP has struck several deals in the past twoyears to rebuild an asset base which almost halved through thefinancial crisis from its peak of 135 billion Swiss francs ($138billion) in 2007.
The deal will lift UBP's assets under management - whichtotalled some 83 billion francs at the end of April - by morethan 10 billion francs, the bank said.
Lloyds, 39 percent-owned by British taxpayers and underpressure from lawmakers and regulators to slim down and focus onlending to British households and businesses, said the salefitted its strategy to simplify its business.
The business being sold has assets under management of 7.2billion pounds, 500 staff and branches in Geneva, Zurich, Monacoand Gibraltar. The bank's private banking operations in Britainwere not included in the sale.
Lloyds said it would receive 100 million pounds for thebusiness, comprising an initial 65 million followed by a further35 million depending on performance in the next two years.
Lloyds also said on Wednesday it would sell its privatebanking business in Miami to Spain's Banco Sabadell,close its business in Dubai and intended to withdraw from SouthAfrica.
Sabadell will pay Lloyds up to 8 million pounds for theMiami business, which has assets under management of 800 millionpounds.
MORE ASSETS
Recent acquisitions by UBP include ABN AMRO's private banking arm, Paris-based asset manager Nexar and aportfolio of assets from Spanish bank Santander's Swissasset management arm.
"The acquisition adds more assets in Zurich and Geneva andallows us to open a booking centre in Monaco, which is a growingcentre for tax-compliant money, family offices and very highnet-worth individuals and families," UBP Chief Executive Guy dePicciotto told Reuters.
The purchase comes at a time when Switzerland's privatebanks sweat over the effects of potential deals betweenSwitzerland and governments in the United States and Europe toroot out untaxed money from Swiss banks.
"It is true everyone is waiting to see what happens, butmeantime there are clients to be served," said de Picciotto.
"We saw a nice client book and good managers, so for us itwas a no-brainer," he added. "Switzerland is a stable countrywith a solid currency and no debt, so it is still attractingtax-compliant money."
Lloyds has been looking to sell assets to boost capital andlast week raised 450 million pounds from the sale of a 15percent stake in wealth manager St. James Place.
Lloyds was rescued by a 20.5 billion pound governmentbailout in the 2008 financial crisis. After a prolonged slump,shares in the bank recently hit a price that would allow thegovernment to break even on its investment if it sold.
Lloyds (LLOY)