Julius Baer To Tighten Private Banking Through Disposals

by Stewart Douglas

Story link: Julius Baer To Tighten Private Banking Through Disposals

Swiss asset management firm Julius Baer has today announced it is looking to tighten up its private banking operation after welcoming certain significant acquisitions from Swiss investment bank UBS.

The move is part of a wider commitment to slim down the company’s banking operation, with a view to improving efficiency within that sector.  It is likely to see the firm sell off its fund management division or its stake in fund manager GAM.

The sell offs would not only enable Julius Baer to refine its operation, but would also provide a significant release of capital for further investment in consolidatory strategies within the asset management sector.

A spokesperson from the firm said that it has been forced to double up its entire staff in order to cope with the expansion of its organisation, whilst it sees improving inter-division communication and cooperation as a key preliminary focus.

The move follows the acquisition of several private banking institutions from UBS and an independent fund manager earlier in the year, which are seen to link more closely to their core business areas as complimentary divisions for the prolific asset management firm.

Additionally UBS have sold their significant stake in the firm, making Juilius Baer a potential takeover target within the finance markets with plenty of capital available for acquisition.

The Julius Baer share price was today given a significant boost in the wake of the news, which investors were predicting would enable the firm to increase margins and revenues over the medium term as well as a potential for excess premium on a takeover in the short term.

It remains to be seen whether there will be any takeover bid as the market is anticipating, and indeed whether the sell offs of too diverse branches will prove to help encourage increased efficiency.