The Swiss wealth manager took a financial hit from cutting dozens of jobs in recent months. The ranks of its private bankers also dropped, despite acquiring 20 advisers through a deal in Mexico.
Julius Baer began cutting its workforce in February, in a bid to tame its bloated spending bill. On Monday, the Zurich-based bank said it will spend 17 million Swiss francs ($17.3 million) to cut roughly 134 of its current 6,693 employees, part of 100 million francs in overall cuts.
The wealth manager reported a tumble in profit as CEO Bernhard Hodler races to slash spending in response to a lull in its business as well as homemade problems including a Venezuelan graft scandal. Hodler, a 21-year-veteran of the bank who spent much of his nearly two years at the helm battling crises, hands over to Philipp Rickenbacher at the end of next month.
Taming Spending
It will fall to new CEO Rickenbacher, currently the bank's head of intermediaries and custody, to get Julius Baer's cost-income ratio back under control. Last year, the measure stood at 70.6 percent, compared to a goal of lower than 68 percent.
The job cuts stand against the acquisition of 20 bankers through Mexico City-based wealth manager NSC Asesores. Julius Baer currently employs 1,490 private bankers in total – 11 less than at year-end. The bank's total headcount rose by 125 people, to 6,768 staff at mid-year. The bank said the cost-cutting is on track but won't be fully felt later this year, and in 2020.
