The Hinduja Group, an Indian conglomerate controlled by the Hinduja brothers Srichand and Gopichand, has bought the Luxembourg-based private-banking arm of KBC, in the latest move by an Indian group to expand its presence in European banking and asset management.

The sale of KBL European Private Bankers for €1.35bn ($1.6bn) is part of KBC's restructuring plan, mandated after it took €7bn in bailout money from the Belgian government to get through the financial crisis. Jan Vanhevel, chief executive, said it would increase the bank's tier-one capital ratio, a measure of financial strength, by one percentage point to 10.4%.