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Julius Bär to cut 300 jobs after 2019 profit drop

Julius Bar

The private bank wants to boost profitability with a new three-year strategy - Click to enlarge

Swiss wealth manager Julius Bär will cut 300 jobs this year, its chief executive said on Monday, as it looks to boost profitability after a double-digit percentage earnings fall in 2019.

The private bank wants to boost profitability with a new three-year strategy to deal with continued margin pressures, Philipp Rickenbacher said.

The Zurich-based lender aims to improve its adjusted cost-income ratio to 67% by 2022, better than its previous 68% target and the 71% level achieved in 2019, by cutting costs by CHF200 million ($206.7 million) and growing income.

“We will accelerate our investments in human advice and technology,” Rickenbacher said. “And we will shift our leadership focus from an asset-gathering strategy to one of sustainable profit growth.”

Ultra-wealthy clientele

Since becoming CEO in September, Rickenbacher has reduced the size of Bär’s executive board to boost efficiency and client focus, particularly on ultra-wealthy clientele.

Bär said on Monday it expected to improve revenues by more than CHF150 million over the three-year period by broadening its offerings for wealthy and ultra-wealthy clients and increasing technology investments to enhance its client advice.

On an unadjusted basis, net profit attributable to shareholdersexternal link fell 37% to CHF465 million in 2019, after a CHF250 million impact from legal provisions and a goodwill impairment on its underperforming Italian asset manager Kairos hit earnings.

Reuters/ts
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