UPDATE 1-Canadian Western Bank buys wealth manager Adroit

(Adds details, comment from CEO)

By Lynne Olver

TORONTO, Oct 20 (Reuters) - Canadian Western Bank (CWB.TO) said on Monday it plans to expand into wealth management by buying a majority stake in Edmonton, Alberta-based Adroit Investment Management Ltd for an undisclosed amount.

Canadian Western, the country's seventh-largest bank by market value, said the deal would provide "a modest positive earnings impact" and diversify the bank's revenue streams and earnings.

"It was a real product gap for us, our people kept saying we need to fill this gap," Larry Pollock, Canadian Western's president and chief executive, told Reuters.

The bank, based in Edmonton, already offers commercial and retail banking and trust services, and sells insurance, but this marks its first move into money management.

Commercial customers selling their private businesses sometimes ended up with millions in cash, and now the bank will be able to offer those clients a wider range of services, Pollock said.

"We have a solution for them, rather than sell them term deposits," said Pollock. "They should have a professional manager for that money."

Canadian Western will buy 72.5 percent of Adroit, which has assets under management of nearly C$1 billion ($840 million), for cash. Adroit's executive management will keep a minority stake. The firm serves individual investors, corporations and institutional clients, Canadian Western said in a press release.

The bank intends to try to attract more institutional mandates and grow the wealth-management business in other ways. For example, Adroit has an inactive British Columbia license, so it could possibly expand westward into B.C., Pollock said.

The transaction is subject to regulatory approval. ($1=$1.19 Canadian) (Reporting by Lynne Olver; editing by Rob Wilson)