Swiss private bank J. Safra Sarasin Group is shutting its Indian joint venture after it was unable to build significant scale in a competitive market hit by slowing economic growth, sources with direct knowledge of the matter said.

India remains a difficult market for global wealth managers, who were drawn by its longer-term prospects only to find revenues being squeezed by cut-throat competition, high staff costs and subdued markets.

Opportunities for growth in India have also been limited by regulations that restrict product offerings, as well as by what some analysts believe to be the concealment of billions of dollars of personal wealth from tax officials.

Sarasin Alpen, a joint venture between J. Safra Sarasin and Dubai-based Alpen Capital, is in the process of leaving India nearly three years after setting up operations in Asia's third-largest economy, the sources said.

Its exit takes place within months of Morgan Stanley's sale of its India wealth management arm to Standard Chartered, while Societe Generale, France's No. 2 listed bank, is selling its Asia private banking arm.

Sarasin Alpen had assets under management of around $100 million, according to the sources, two of whom have direct knowledge of the matter. By comparison, large wealth managers in India such as Standard Chartered and Bank of America Merrill Lynch each manage assets worth between $3 billion and $4 billion or more.

Assets of the venture, which one of the sources said had roughly 20 staff in its India unit, will be handed back to clients, or in some cases the relationship manager will move with his client assets to another private bank, one of the sources said.

The sources declined to be named as they were not authorised to speak to the media. A spokesman for J. Safra Sarasin in Basel, Switzerland, declined to comment. A spokeswoman for Alpen Capital referred a Reuters query to J. Safra Sarasin.

J. Safra Sarasin's decision to shut the Indian joint venture, which also offers wealth management services in some countries in the Middle East, was also a result of its renewed focus on core markets in Europe, one of the sources told Reuters.

India, whose economy is growing at its slowest pace in a decade, had 164,000 millionaire households last year, down from 190,000 in 2010, according to the Boston Consulting Group's global wealth report.-Reuters