Julius Baer lays out scale of cuts

City A.M. Reporter
SWISS private bank Julius Baer could cut up to 880 jobs at Bank of America Merrill Lynch’s overseas wealth management business, including in London, as the integration of the newly acquired unit gets under way, it is understood.

Julius Baer’s chief executive Boris Collardi is thought to have told an investor meeting that between 30 and 40 per cent of the Bank of America Merrill Lynch overseas wealth management unit’s 2,200 jobs will have to go, equal to 660 to 880 roles.

Collardi told the investors the move was intended to cut the bank’s cost-income ratio from the current rate of over 100 per cent down to 70 per cent, according to leading Swiss publication Der Sonntag yesterday.

A spokesman for Julius Baer declined to comment on the report.

Julius Baer announced the acquisition of the Merrill Lynch unit in August as it seeks to expand in fast-growing emerging markets, but investors balked at the total cost, estimated at 1.47bn Swiss francs (£970m), sending its shares sharply lower.

The purchase means the firm now has a duplication of roles in its major financial centres in Singapore, Hong Kong, Switzerland and its offices in the City of London.

Investors had been wary of the acquisition and shot down plans by Julius Baer management to raise more capital in a new rights issue for future acquisitions.

Collardi’s comments are understood to have focused on a core strategy for the bank of reducing costs and increasing volumes.

Earlier this month he hinted at the scale of future job cuts in the merged businesses due to staff overlaps and revealed plans to merge two offices in Singapore in a bid to cut costs.

“We expect (to cut) several hundred jobs, including in Switzerland,” he said.