Julius Baer Group Ltd., the 121-year old Swiss wealth manager, plans to buy back as much as 500 million Swiss francs ($524 million) of shares after full-year profit declined 9.3 percent.
Net income fell to 353 million francs in 2010 from 389 million francs a year earlier, the Zurich-based bank said today in an e-mailed statement. The private bank plans to repurchase as much as 5 percent of its outstanding shares by its annual shareholder meeting next year.
As clients reassess the benefits of cross-border accounts, Switzerland’s fifth-biggest money manager must decide whether to build branch networks in Europe and Asia to compete with larger rivals such as UBS AG and Credit Suisse Group AG. Net inflows increased to 5.4 billion francs in the second half of 2010, from 3.3 billion in the previous six months, Baer said.
“We’ve seen regained momentum in the second half and hope to continue this into 2011,” Chief Executive Officer Boris Collardi told reporters on a conference call today from Zurich.
Baer rose 2.1 percent to 44.49 francs as of 9:32 a.m. in Zurich trading, valuing the bank at 9.2 billion francs. The stock has climbed 39 percent over the past 12 months compared with a 15 percent gain in the 48-member Bloomberg Europe Banks and Financial Services Index.
Total managed assets fell to 170 billion francs at the end of 2010 from 175 billion francs two months earlier, partly because of gains in the Swiss currency against the dollar and euro, which together account for more than two-thirds of client assets.
The negative currency effect over the full year was about 14 billion francs, Baer said.
Baer increased its total number of relationship managers by 85 to 752 over the year and said that its annual hiring target remains 40 to 50. Two-thirds of last year’s additions came from the bank’s acquisition of ING Groep NV’s Swiss business, which added 13.5 billion francs to managed assets.
Collardi may use the bank’s excess capital to make more acquisitions.
“There are still a few targets in the market which could be interesting,” Chief Financial Officer Dieter Enkelmann told reporters.
Profit, excluding integration and restructuring costs and amortization, climbed 6 percent to 504 million francs.
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