Julius Baer said first-half profit rose 26 percent, and kept hiring bankers. The pace at which the Swiss private bank hoovered up fresh funds from wealthy clients is slowing. Clients in Asia showed caution.
The Zurich-based bank said net profit stood at 443.8 million Swiss francs ($446.9 million) in the first half, compared to 353.2 million francs year-ago. The Swiss bank is successfully keeping a lid on costs: its ratio of costs on income actually fell to 67.3 percent (from nearly 69 percent at year-end), while maintaining its profit margins.
The pace of net new money gains is slowing: Julius Baer's overall assets stood at 400 billion francs – 11 billion francs, or 3 percent, more than year-end. This includes 4.5 billion francs due to Brazilian acquisition Reliance as well as a 1 billion franc gain from currency swings.
Julius Baer said clients Middle East as well as some in Asia began unwinding positions, «reflecting a more cautious positioning of their portfolios, in line with broader market sentiment.»
Hiring Private Bankers
Overall, clients brought 10 billion francs to the Swiss bank in the period, including the acquisition. The net new money represents growth of 5 percent against existing assets – smack in the middle of a 4 to 6 percent target range.
Julius Baer hired 94 new private bankers in the first six months – 13 from Reliance – to bring its total to 1,475. Its staff costs rose by 11 percent, while its general spending edged 8 percent higher, mainly for marketing campaigns.
The bank has taken a far more public face through its backing of Formula E, an electric car-racing circuit which was carried out in Zurich last month. Julius Baer CEO Bernhard Hodler voiced confidence that the bank will hit its net new money and spending targets this year.
