Assets under management (AuM) increased by 11% to a new record high of CHF 189 billion. The increase was the result of a significant positive market performance, net inflows of CHF 9.7 billion (5.7%), and a slightly negative currency impact. Total client assets (including assets under custody) grew by 7% to CHF 277 billion.
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Operating income decreased by 1% to CHF 1,737 million, while average AuM went up by 8%, resulting in a gross margin of 96 basis points (bps) (2011: 105bps). The lower gross margin was a direct consequence of a further reduction in client activity.
Adjusted operating expenses declined by 5% to CHF 1,216 million as the expenses in 2011 included the one-off tax-related Germany payment (2011 Germany payment) of EUR 50 million (CHF 65 million). Excluding the 2011 Germany payment, the adjusted operating expenses were flat.
As a result, the adjusted cost/income ratio went up to 71% (2011: 68%).
Adjusted net profit including the 2011 Germany payment increased by 8% to CHF 433 million and adjusted earnings per share (EPS) by 11% to CHF 2.14. Excluding the 2011 Germany payment, adjusted net profit decreased by 4%.
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By GlobalDataIFRS net profit grew by 15% to CHF 298 million and IFRS EPS by 19% to CHF 1.47.
At year-end, the Group’s BIS total capital ratio stood at 31.6% and its BIS tier 1 ratio at 29.3%, helped by the pre-funding of the acquisition of Merrill Lynch’s International Wealth Management (IWM) business outside the US.
The Board of Directors will propose to the AGM on 10 April 2013 an unchanged ordinary dividend of CHF 0.60 per share.
The principal closing of the IWM acquisition took place on 1 February 2013. As a first step of the integration, Julius Baer acquired the Geneva-based Merrill Lynch Bank (Suisse) S.A. with AuM of around CHF 11 billion, taking Julius Baer’s AuM above the CHF 200 billion mark for the first time.
Boris F.J. Collardi, Chief Executive Officer of Julius Baer Group Ltd., said: "We remained well in favour with clients in all our markets in 2012. The resulting substantial net new money inflow near the top end of our target range underlines the fundamental strength of Julius Baer’s product and service offering, further leveraged by our strong brand name. This translated into solid financial results for the year. In addition to these ongoing business activities, we initiated the transition into Julius Baer’s next strategic phase of growth by acquiring Merrill Lynch’s International Wealth Management business outside the US, the integration of which is well on track."
