Julius Baer Inflows Beat as CEO Bollinger Revamps Swiss Firm
Clients added a net 7.9 billion Swiss francs ($9.9 billion) in the six months through June, exceeding the 6.5 billion francs estimated by analysts. Net income fell 35% to 295 million francs, reflecting the impact of a previously disclosed loan loss allowance and a divestment in Brazil.
'We have good momentum and we are moving in the right direction,' Bollinger said in an interview.
The CEO and Chairman Noel Quinn are seeking to put the bank on a path for growth again after losses linked to the collapse of Rene Benko's real estate empire prompted the wealth manager to shake up its management. Yet a drip feed of bad news has complicated their mission.
In May, the bank booked another large loss from property developments it helped finance, resulting in a 130 million-franc charge related to its private debt business and selected positions in its mortgage operation.
Julius Baer said it hasn't found a need so far for more loan loss allowances as it continues the review of its credit book, which is expected to be completed 'in the next few months.'
Shares of Julius Baer rose 2.3% at 9:O2 a.m. in Zurich, paring losses this year to around 1%.
'While it is early days in the execution of the strategy, net new money trends and operating performance especially on costs were encouraging,' Anke Reingen, an analyst at RBC Capital Markets, wrote in a note.
As part of his turnaround plan, the new CEO has slashed the top management ranks and announced hundreds of job cuts. He has cautioned that his restructuring efforts will push up expenses at first, before bearing fruit from next year.
Julius Baer said on Tuesday that 78 relationship managers have left so far this year, most of them for performance reasons.
(Updates with CEO comment in third paragraph, shares in seventh.)
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