Under the agreement, BOC will refer its clients with international private banking needs outside Chinese mainland to Julius Baer, while the Swiss bank will do the same for its clients requiring banking services in China.

"Our international private clients have become much more demanding in recent years. The cooperation with Julius Baer instantly complements our existing private banking capabilities," said Li Lihui, BOC vice chairman and president.

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The agreement also features other joint initiatives, such as cooperation in product distribution and financial market research.

The BOC agreement follows Julius Baer’s clients’ cross-referring agreement with the Australian Macquarie group in October 2011, which also led the Swiss pure-play wealth manager to buy Macquarie’s Asian private wealth division.

Macquarie’s Private Wealth Asia unit operated from offices in Singapore and Hong Kong and managed total client assets of around $1bn.

The partnership with BOC sets the basis for Julius Baer’s fully operational entrance in the Chinese mainland private banking market.

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"The partnership offers the potential for Julius Baer to gain further access to Chinese Mainland, one of the world’s most important and fastest-growing wealth markets," said Julius Baer CEO Boris Collardi.

The Swiss bank opened its first Chinese office in Shanghai in November 2011 but can not currently provide any products in China because foreign banks can only apply for a business license after having a representative office for two years.

Julius Baer’s move into China followed the company’s Asia’s Wealth Report, published in September 2011, which predicted that by 2015 the numbers of high net worth individuals (HNWI) across Asia will more than double to 2.82m.

The Swiss bank did not want to disclose if it envisages further agreements or acquisitions in the region.

 

 

Source: Private Banker International