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Julius Baer operating income grew to CHF 1,425 million

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Staff Writer | Monday July 25, 2016 6:05AM ET
Julius Baer
Julius Baer   Adjusted operating expenses fell

Julius Baer Assets under Management (AuM) ended the first six months at CHF 311 billion, an increase of CHF 12 billion, or 4%, since the end of 2015.


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Operating income grew to CHF 1,425 million, an increase of 1% compared to the first half of 2015. Following lower client transaction and trading volumes, the gross margin declined to 95 basis points (bps), a reduction of four bps from H1 2015.

However, compared to H2 2015 the gross margin increased by almost seven bps, supported by an increase in trading income which was helped by higher foreign exchange (FX) volumes following the UK’s Brexit vote in June.

Adjusted operating expenses fell to CHF 940 million. This represents a year-on-year reduction of 1% if the $350 million (CHF 326 million) initial provision for the settlement with the US Department of Justice (the H1 2015 US provision) is excluded from the expenses in the first half of 2015. Including the H1 2015 provision, the expense decrease was 27%.

Expenses benefited in H1 2016 from a positive impact of CHF 63 million resulting from the pension fund plan amendment in Switzerland.

The adjusted cost/income ratio remained at 64.7%. Without the pension fund-related impact, the adjusted cost/income ratio increased to 69.1%, reflecting the lower gross margin as well as the Group’s accelerated investments in growth this year.

Adjusted net profit for the Group improved by 270% to CHF 402 million and adjusted earnings per share (EPS) attributable to shareholders of Julius Baer Group Ltd. by 274% to CHF 1.84.

Excluding the H1 2015 U.S. provision, adjusted net profit for the Group and adjusted EPS grew by 5%.

IFRS net profit attributable to shareholders of Julius Baer Group Ltd. rose by 828% to CHF 362 million and IFRS EPS by 834% to CHF 1.66.

 

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