Julius Baer Jumps on Credit Suisse Takeover Speculation

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Julius Baer Group Ltd. jumped to the highest since it began trading in its current form more than five years ago, amid speculation that Credit Suisse Group AG is interested in buying the private bank.

The company, listed after splitting off its asset management business in October 2009, rose as much as 5.1 percent to 52.15 Swiss francs. It traded at 51.70 francs as of 3:18 p.m. in Zurich.

“It’s just a rumor that comes out every three months, and a part of the market believes it,” said Benno Galliker, a trader at Luzerner Kantonalbank AG in Lucerne, Switzerland.

“Swiss private banking is going through a tough moment, so there’s certainly some interest to consolidate the business,” he said. But Julius Baer “still has the tax issues with the U.S., and as long as this issue is ongoing I don’t think anyone wants to buy Julius Baer.”

Julius Baer is among Swiss banks under investigation in the U.S. on charges of helping Americans hide money offshore. The company has said it can’t reliably estimate the potential fine to resolve the case, which it expects to settle this year. Julius Baer spokesman Jan Vonder Muehl said the bank doesn’t comment on speculation. Credit Suisse spokeswoman Katrin Schaad also declined to comment.

Chief Executive Officer Boris Collardi on Feb. 2 ruled out holding talks with potential buyers and said the Swiss wealth manager isn’t for sale.

“Julius Baer is well-positioned as an independent wealth manager,” said Michael Kunz, an analyst with Zuercher Kantonalbank, which has a market perform rating on the bank. “A merger with Credit Suisse just doesn’t add up.”

UBS Group AG analysts upgraded their Julius Baer target price by 20 percent to 55 francs on Tuesday, citing earnings-per-share growth, cash returns and strategic flexibility. The analysts kept a buy rating on the stock.

In 1980, Julius Baer became the first Swiss private bank to sell stock to the public as Baer Holding Ltd. After the split in 2009, the asset management business became known as GAM Holding AG, an independently listed company in Zurich, and the private client business as Julius Baer Group Ltd.

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