Julius Baer, the Zurich-based private bank, has had a healthy increase in net new money in the first ten months of the year. Margins however remain under pressure.
Julius Baer assets under management rose 17 percent to 393 billion Swiss francs by the end of October, the company said in a statement today. At the current growth rate, the bank led by CEO Boris Collardi may yet reach the next milestone – 400 billion francs.
Growth of net new money was driven by the momentum in emerging markets and the Asia Pacific region, with a growth rate above the target range of 4 to 6 percent. Julius Baer said the increase was a direct consequence of the hiring of new relationship managers over the past two years.
The second driver of growth was the performance the bank achieved with the assets it manages. The third source was the sustained appreciation of the euro versus the Swiss franc.
Drop in Gross Margin
Still, the bank also had a slowdown of customer transaction over the summer months. The gross margin fell below 90 basis points, down from the 92 points in the first half of 2017. The cost income ratio improved marginally to 69 percent.
The CET1 capital ratio of Julius Baer was 16.4 percent at the end of October. The strengthening of the capital ratio was partly due to the placement of $300 million of additional tier 1 securities in September 2017.
Julius Baer will publish the full-year results on January 31, 2018.
