Julius Baer’s Asia revenue may top Europe in five years, CEO Says

Boris Collardi

Julius Baer Group Ltd. said Asia may overtake Europe as its biggest revenue-generating region, as the Swiss wealth manager steps up hiring in Hong Kong and Singapore.
“In the next five years, Asia could be the biggest region for us if we grow at double digit” rates, Julius Baer Chief Executive Officer Boris Collardi said yesterday in an interview in Singapore. More than half of about 200 new bankers that Julius Baer plans to hire this year will be based in Asia, he added.
Asia contributed about 532 million Swiss francs (USD543 million) of Julius Baer’s operating income in 2015, small compared with the 2.2 billion Swiss francs from Switzerland and the rest of Europe. But the share of revenue generated in Asia has been growing fast, doubling to about 20 percent of the total last year from about 10 percent in 2011.
Julius Baer is the fifth-largest private bank in Asia in terms of assets under management, according to a 2015 ranking by Asian Private Banker. Its AUM in Asia stood at $75.1 billion, the publication said. It’s the third largest in Switzerland after UBS Group AG and Credit Suisse Group AG.
Like UBS and Credit Suisse, Julius Baer has been expanding in Asia, lured by the growing number of rich people. Private wealth in the Asia-Pacific region surpassed that of North America for the first time in 2015, according to a report by Cap Gemini SA.
“In general we are following where the market is going. And Asia is our second home,” Collardi said in a separate Bloomberg Television interview yesterday with Haslinda Amin. He said the bank has been hiring in Hong Kong and Singapore “in a big way.”
Collardi said he doesn’t rule out the idea of further acquisitions, but for the moment his bank is focused on expansion through hiring. Julius Baer last year completed the acquisition of the Merrill Lynch wealth management business outside the U.S., which it bought from Bank of America Corp.
The acquisition of other private banks can either be expensive, or pose substantial risks at a time of stricter regulation, Collardi said. He noted the case of BSI SA, a Swiss private bank which this year agreed to be taken over by EFG international AG. BSI was subsequently fined by regulators in Switzerland and Singapore for its ties to 1Malaysia Development Bhd., the development fund at the center of global probes into alleged money laundering. 1MDB denies any wrongdoing.
Singapore withdrew BSI’s banking license for breaches including failure to conduct due diligence on high-risk accounts and to monitor suspicious customer transactions. Chanyaporn Chanjaroen, Bloomberg