Swiss wealth management group Julius Baer posted a record-high net profit in 1H2021 on the back of strong growth in Assets under Management (AUM) and improvement in cost efficiency. The group reported a 23% rise in its net profit and earnings per share (EPS) YoY to CHF 606mn ($661mn) and CHF 2.81 ($3.06) respectively. The AUM jumped 12% from the end of 2020 to a new record of CHF 486bn ($530bn) supported by strong markets, weaker Swiss Franc and new inflows of CHF 10bn ($10.9bn). A large part of the new inflows came from wealthy clients in Asia and Western Europe. The bank also reported a growth of 8% YoY in operating income at CHF 1.93bn ($2.1bn) supported by record high commissions and fee income which rose 12% YoY to CHF 1.16bn ($1.26bn) although, lower interest rates dragged net interest income by 8% to CHF 308mn ($336mn). The bank was strongly capitalised and reported a CET1 capital ratio of 16.7% and a total capital ratio of 22.8% comfortably over the regulatory requirements. The adjusted return on CET1 capital was up 2% YoY to 38% in 1H2021. The Swiss private banking group also announced that it was developing a real estate offering as part of its Swiss market strategy which currently focuses on mortgage finance. The earnings of Julius Baer follow the strong growth of 63% in net profits of its peer UBS yesterday.
Julius Baer’s bonds were stable. It’s 4.75% perps and 5.75% perps were trading at 104.45 and 102.73 respectively.