The Swiss private bank is signaling its willingness to return to the deal hunt under CEO Philipp Rickenbacher. Switzerland's regulator had put the kibosh on major acquisitions as part of a sanction for money laundering.
Germany, the U.K. and the Iberian Peninsula are the three markets Julius Baer wants to expand in, CEO Philipp Rickenbacher told Swiss outlet «The Market» (behind paywall, in German) on Tuesday. He could envisage reassembling a deal team to start looking at major acquisitions again, he said.
«Acquisitions were a strength of ours in the past,» Rickenbacher said. The bank is banned from major deals by its home regulator, Finma, «until it once again fully complies with the law». The Bern-based overseer imposed the ban in February, when it censured Julius Baer for failing to spot graft money linked to PDVSA, Venezuela's state-controlled oil firm.
Throttled And Redirected
Rickenbacher, who was five months into the top Julius Baer job when the PDVSA punishment landed, has throttled and redirected growth targets, overhauled bonuses, and is reportedly seeking to clawback pay from former executives including ex-CEO Boris Collardi as a result of the scandal.
Finma will review the ban on major dealmaking next year, Rickenbacher told the outlet, «and based on the measures we have taken, I'm optimistic that we can remove the restrictions in 2021.» A spokesman for Finma didn't comment on the CEO's prediction or its own timeline.
Screening Targets
Takeovers are how Julius Baer powered to its current size: it is the third-largest wealth manager in Switzerland, after UBS and Credit Suisse, with 413 billion Swiss francs ($450 billion) under management. The largest, the purchase of Merrill Lynch's private bank outside of the U.S. in 2012, alone added more than 50 billion francs.
Rickenbacher didn't disclose where Julius Baer, which is looking to bulk up in Latin America after exiting Venezuela and Panama, would look for deals: «We monitor the market actively, and I am confident that we will achieve takeovers in the coming years,» the 49-year-old Swiss banker said.
Search For China Partner
«Brazil and Mexico are our two largest American markets,» he noted. In Asia, where Julius Baer now manages more than one-quarter of its overall assets, the wealth manager maintains two «stellar» platforms; the bank is more cautious in China.
Julius Baer reportedly wants to open a wealth management joint venture in China as part of its strategy to boost growth in Asia and tap the rapidly growing wealth market. The bank will reportedly make a decision on its Chinese partner early next year.
