• Switzerland's news in English

Julius Bär targets 1,000 job cuts after acquisition

Malcolm Curtis/The Local/AFP · 9 Oct 2012, 10:35

Published: 09 Oct 2012 10:35 GMT+02:00

Facebook Twitter Google+ reddit

The bank announced the plan on Tuesday in the wake of its planned acquisition of Bank of America Merrill Lynch’s wealth management business outside the US and Japan.

The targeted reductions amount to between 15 and 18 percent of its workforce of around 5,700 people in more than 50 locations.

In August, when the deal was announced, Julius Bär said it expected to pay a total of about 1.47 billion francs ($1.57 billion), including integration costs, to acquire the wealth management business of the American bank.

The business involves managing more than 57 billion francs in assets from clients in Europe, Asia, Latin America and the Middle East.

Julius Bär, which describes itself as Switzerland’s leading private bank, said it expects the acquisition, which aims to tap into emerging markets, will boost earnings per share 15 percent by 2015, not including restructuring costs.

The bank said it planned "a significant reduction of former Bank of America corporate overhead and other allocations not required going forward in the Julius Bär structure."
It expects the deal to close in the first quarter next year.

About 80 percent of the total assets it is acquiring will be reported at Julius Bär by the end of 2013, the bank said.

It said it had managed to raise 250 million francs in non-core tier 1 capital in September to help finance the acquisition.
It is also planning a rights issue to help with the financing and said on Monday it expects to sell 20 million new shares to rake in around 492 million francs during the October 10th-16th operation.

The bank, specialized in wealth management, said it would present more details of the acquisition to analysts and investors in London later on Tuesday.

In its statement, Julius Bär said the planned job cuts and other cost-cutting measures were expected to lead to an implied cost-income ratio of about 70 percent and a pre-tax profit margin of around 25 basis points for the acquired business in 2015.

The Swiss bank also said it expected the deal to be at least earnings per share-neutral by 2014.

On a separate note, the company reported that the assets it currently has under management increased to a new record high of 184 billion francs, which is 14 billion francs, or eight percent higher than at the end of 2011.

Malcolm Curtis/The Local/AFP (news@thelocal.ch)

Facebook Twitter Google+ reddit

Your comments about this article

Today's headlines
‘Scary clown’ craze hits streets of Zurich
Photo: Pedro Pardo/AFP

Police in Zurich have warned so-called ‘scary clowns’ that they could face charges, following a number of incidents in the city.

VIDEO: driver chases runaway car on Swiss motorway
Image: Neuchâtel police

Shocking footage shows the moment a man dodged lorries to chase after his runaway car on a Swiss motorway.

Saas-Fee crowdfunds low-cost season ski pass
Saas-Fee is hoping to attract 99,999 season pass holders. Photo: Denis Emery/Photo-genic.ch

Skiers could get their hands on a whole season pass for just 222 francs ($223) in the Swiss resort of Saas Fee this winter – if enough people want one.

Swiss billionaire fined for dodging import tax
Urs Schwarzenbach owns the luxury Dolder Grand hotel in Zurich. Photo: Wilhem Rosenkranz

Urs Schwarzenbach faces a $4 million fine for failing to properly declare some 200 artworks imported into Switzerland.

Muslim woman wins headscarf court battle
Photo: Jack Guez / AFP

A Swiss court has ruled against a company that fired a longtime employee after she began wearing the Muslim headscarf.

Montreux throws hat in Olympic rings
Could Montreux host the 2026 Games? Photo: Ivo Scholz/Swiss Tourism

Montreux is to put itself forward as the host city for the 2026 winter Olympics as part of a potential bid by the cantons of Valais and Vaud.

Geneva car share scheme could help reduce city traffic
Catch a Car is aimed at short hops within a city. Photo: Catch a Car

Catch a Car, already in Basel, launches in Geneva next month.

Swiss women will ‘work for free’ for the rest of year
Female employees in Switzerland earn 19.3 percent less than their male colleagues. File photo: Randy Kashka

Switzerland's gender pay gap means from today, Friday October 21st, women in the country will effectively be working for free for the rest of 2016.

Swiss luxury watches stolen in Paris raid
Police outside the Girard-Perregaux watch store on Thursday. Photo: Bertrand Guay/AFP

The 10 Girard-Perregaux watches are worth half a million euros in total.

Brother-in-law arrested over murder of Swiss teacher
The victim worked in a school in Stabio, near the town of Mendrisio. Photo: Oliver Graf

The primary school teacher was found dead in Ticino earlier this week.

Photo: Richard Juilliard/AFP
Man makes Geneva airport bomb threat ‘for a joke’
Sponsored Article
Last chance to vote absentee in the US elections
Photo: AFP
Solar Impulse team reveals plans for unmanned plane
File photo: Martin Abegglen
Swiss to vote on passport rules for 3rd gen foreigners
Photo: AFP
Swiss wingsuit hotspot Lauterbrunnen won’t impose ban
Photo: Swiss Tourism
Six reasons Switzerland isn’t as boring as you might think
Photo: Swiss Tourism
Report: Switzerland one of world’s best places for girls
Photo: The Local
Thief returns Swiss cow bells worth thousands
File photo: Wikimedia Commons
One in three rapists isn’t locked up: statistics
Photo: activistin.ch
Tampon-tax protest turns Zurich fountains red
Photo: AFP
Geneva police to lift ban on bearded officers
Photo: Marcel Gillieron/AFP
Suicide chef’s restaurant keeps Michelin stars
Photo: Lara de Salis
11 things the Swiss get tired of hearing abroad
Photo:  Ivo Scholz/Swiss-image.ch
Survey: expats in Switzerland have money but few friends
Photo: AFP
Swiss press criticize Bern’s 'capitulation' on immigration
Photo: Jura Trois Lacs tourism
German ex-policeman is Swiss city’s new hermit
Photo: Dmitry A. Mottl
Ticino votes to favour local workers over foreigners
Photo: file
Some deodorants could cause breast cancer: Swiss study
Photo: Royal Savoy
In pictures: Inside the latest Swiss luxury hotel
Photo: AFP
Geneva airport bomb hoaxer faces 90,000-franc bill
Photo: Schaffhausen police
Mother leaves toddler son alone in car to go clubbing
Photo: Fabrice Coffrini/AFP
Swiss populist attacked by knife-wielding pensioner
jobs available