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February 4, 2019

Julius Baer net profit rises and AuM dips amidst job cuts

Swiss private bank Julius Baer has reported net profit attributable to shareholders of CHF735.4m for the year ended 31 December 2018.

This is an increase of 4% from CHF704.8m in the previous year.

The bank’s adjusted net profit rose slightly to CHF810m from CHF806m last year.

Operating income increased 4% to CHF3.36bn from CHF3.25m, while operating expenses increased 5% year-on-year to CHF2.47bn.

Assets under management totalled CHF382bn at the end of December 2018, down 2% from a year ago. The fall was said to be due to unfavourable markets.

Net new money during the period was CHF17bn, a growth rate of 4.5% within its 4-6% target range.

BIS CET1 capital ratio and BIS total capital ratio were 12.8% and 18.7%, respectively. The figures were said to be “well above minimum regulatory requirements”.

Julius Baer also announced that it will raise payout to shareholders to 1.50 francs per share.

At the same time, the bank unveiled plans to lay off 2% of its workforce in a drive to reduce costs.

The CHF100m cost reduction programme will not affect strategic growth investments, the private bank said.

Julius Baer Group CEO Bernhard Hodler said: “Julius Baer ended 2018 with stable profit and robust net new money growth − and we did so in an environment that was challenging for the entire industry.

“We continue to make strategic growth investments, and have initiated a structural cost reduction programme to absorb revenue fluctuations from potential market headwinds over the short to medium term.”

 

 

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