Interim Management Statement for the first ten months of 2024*

Ad hoc announcement pursuant to Art. 53 LR

Substantial increase in client assets – Accelerated net inflows – Solid capital position – Start date of new CEO set for 9 January 2025.

Zurich, 21 November 2024 – In the first ten months of 2024, Julius Baer realised substantial growth in assets under management (AuM), supported by accelerated net new money inflows since the end of June. The Group’s CET1 capital ratio improved to 16.7%, underlining the strong capital-generating nature of the Group’s business model. Julius Baer’s designated CEO Stefan Bollinger will start on 9 January 2025. 

AuM grew by 12% to CHF 480 billion – Accelerated net inflows

In the first ten months of 2024, AuM rose to CHF 480 billion, a year-to-date increase of 12%. Total client assets reached a record high of CHF 570 billion. The increase in AuM was driven by strong stock markets as well as solid net inflows of CHF 11 billion. The positive currency impact experienced in the first half of the year was partly reversed over the past four months.

Compared to the first half of 2024 (H1 2024), when net inflows were at CHF 3.7 billion (1.7% annualised), net new money in the July–October 2024 period accelerated to CHF 7.5 billion (4.8% annualised). The latter result included a large single transactional inflow of which the majority left in November. Excluding this transaction, the July–October inflow pace was 4.2%.

Net new money flowed in predominantly from clients domiciled in strategic key markets in Europe (especially the UK and Germany), Asia (particularly Singapore and India), and the Middle East (especially the UAE). The impact of client deleveraging diminished meaningfully compared to previous years.

In the first ten months of 2024, the number of relationship managers grew by 46 full-time equivalents (FTEs) to 1,389.

Gross margin 83 basis points

In the first ten months of 2024, the gross margin decreased to 83 basis points (bp), compared to the 88 bp underlying^** gross margin for full year 2023 (FY 2023). 

In the July–October 2024 period, the gross margin was 81 bp, a decline from the 85 bp reported for H1 2024, but similar to the level in May–June 2024 (excluding the loss related to the sale of Kairos in May 2024):

• The gross margin contribution from recurring income (within net commission and fee income) declined slightly to 37 bp (H1 2024: 38 bp), partly due to the full four-month impact of the deconsolidation of Kairos in May 2024.
• Interest-driven income contributed 23 bp (H1 2024: 24 bp) to the gross margin, of which 7 bp (H1 2024: 10 bp) from net interest income, and 16 bp (H1 2024: 14 bp) from treasury swap income (within net income from financial instruments at FVTPL^***).
• Activity-driven income added 21 bp (H1 2024: 24 bp) to the gross margin, of which 10 bp (H1 2024: 10 bp) from the non-recurring revenues within net commission and fee income, and 11 bp (H1 2024: 14 bp) from the revenues not related to treasury swap income within net income from financial instruments measured at FVTPL. Following a seasonally slower third quarter, activity-driven income improved again in October.

Cost/income ratio 71%, pre-tax margin 24 bp

The adjusted cost/income ratio remained at 71%, compared to 69% (underlying) in FY 2023, and the adjusted pre-tax margin at 24 bp compared to 26 bp (underlying) in FY 2023.

Strongly capitalised

In Switzerland, the final Basel 3 standard (B3F) will be implemented with effect from 1 January 2025. In the first ten months of 2024, on the basis of the currently applicable standard, the Group’s CET1 capital ratio strengthened to 16.7% (end 2023: 14.6%) and the total capital ratio rose to 24.7% (end 2023: 24.0%). This development was reinforced by the further benefit of the ‘pull-to-par’ reversal of the decline (back in 2021 and 2022) in the value of bonds held in the Group’s treasury portfolio (financial assets measured at FVOCI^****), as well as a further reduction in the private debt loan book to just above CHF 0.4 billion (end 2023: CHF 0.8 billion; end June 2024: CHF 0.6 billion), at 100% credit risk weighting.

At these levels, the Group’s CET1 and total capital ratios remain well above the Group’s own floors of 11% and 15% respectively, and significantly in excess of the regulatory requirements of 8.3% and 12.5% respectively.

Following the redemption of the AT1 bonds issued in 2017 (USD 300 million aggregate nominal amount) in September 2024, the Group’s tier 1 leverage ratio stood at 4.8% (end 2023: 4.9%), substantially above the regulatory requirement of 3.0%.

The Group currently expects that IFRS net profit for the full year 2024 will significantly exceed the one achieved in FY 2023.

New CEO Stefan Bollinger to start on 9 January 2025

As announced in July 2024, the Board of Directors has appointed Stefan Bollinger as Chief Executive Officer. The Group can now confirm that Stefan Bollinger will join Julius Baer on 9 January 2025.

Q&A webcast

Following the publication of the Interim Management Statement for the first ten months of 2024, Julius Baer management, represented by CFO Evie Kostakis, will hold a question-and-answer session with analysts at 8.00 a.m. (CET). The webcast can be followed live, and will remain available, via www.juliusbaer.com/webcast.

^* Based on unaudited management accounts. This media release contains certain financial measures that are not defined or specified by IFRS, the definitions of which are provided in the Alternative Performance Measures section of the Half-Year Report 2024, available at www.juliusbaer.com/reports.

^** Underlying: Excluding in H2 2023 the CHF 586 million increase in loan loss allowances against the single largest exposure in private debt.

^*** Fair value through profit or loss.

^**** Fair value through other comprehensive income.

Contacts

Media Relations, tel. +41 (0) 58 888 8888

Investor Relations, tel. +41 (0) 58 888 5256

 

Important dates

3 February 2025: Publication and presentation of 2024 full-year results

17 March 2025: Publication of Annual Report 2024 including Remuneration Report 2024

17 March 2025: Publication of Sustainability Report 2024

10 April 2025: Annual General Meeting, Zurich

About Julius Baer

Julius Baer is the leading Swiss wealth management group and a premium brand in this global sector, with a focus on servicing and advising sophisticated private clients. In all we do, we are inspired by our purpose: creating value beyond wealth. At the end of October 2024, assets under management amounted to CHF 480 billion. Bank Julius Baer & Co. Ltd., the renowned Swiss private bank with origins dating back to 1890, is the principal operating company of Julius Baer Group Ltd., whose shares are listed on the SIX Swiss Exchange (ticker symbol: BAER) and are included in the Swiss Leader Index (SLI), comprising the 30 largest and most liquid Swiss stocks.

Julius Baer is present in around 25 countries and 60 locations. Headquartered in Zurich, we have offices in key locations including Bangkok, Dubai, Dublin, Frankfurt, Geneva, Hong Kong, London, Luxembourg, Madrid, Mexico City, Milan, Monaco, Mumbai, Santiago de Chile, São Paulo, Shanghai, Singapore, Tel Aviv, and Tokyo. Our client-centric approach, our objective advice based on the Julius Baer open product platform, our solid financial base, and our entrepreneurial management culture make us the international reference in wealth management.

For more information, visit our website at www.juliusbaer.com

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This media release by Julius Baer Group Ltd. (‘the Company’) includes forward-looking statements that reflect the Company’s intentions, beliefs or current expectations and projections about the Company’s future results of operations, financial condition, liquidity, performance, prospects, strategies, opportunities and the industries in which it operates. Forward-looking statements involve all matters that are not historical facts. The Company has tried to identify those forward-looking statements by using the words ‘may’, ‘will’, ‘would’, ‘should’, ‘expect’, ‘intend’, ‘estimate’, ‘anticipate’, ‘project’, ‘believe’, ‘seek’, ‘plan’, ‘predict’, ‘continue’ and similar expressions. Such statements are made on the basis of assumptions and expectations which, although the Company believes them to be reasonable at this time, may prove to be erroneous.

These forward-looking statements are subject to risks, uncertainties and assumptions and other factors that could cause the Company’s actual results of operations, financial condition, liquidity, performance, prospects or opportunities, as well as those of the markets it serves or intends to serve, to differ materially from those expressed in, or suggested by, these forward-looking statements. Important factors that could cause those differences include, but are not limited to: changing business or other market conditions, legislative, fiscal and regulatory developments, general economic conditions in Switzerland, the European Union and elsewhere, and the Company’s ability to respond to trends in the financial services industry. Additional factors could cause actual results, performance or achievements to differ materially. In view of these uncertainties, readers are cautioned not to place undue reliance on these forward-looking statements. The Company and its subsidiaries, and their directors, officers, employees and advisors expressly disclaim any obligation or undertaking to release any update of or revisions to any forward-looking statements in this media release and any change in the Company’s expectations or any change in events, conditions or circumstances on which these forward-looking statements are based, except as required by applicable law or regulation.