Switzerland · Delayed Price · Currency is CHF Julius Bär Gruppe AG Earnings Call Transcripts
Fiscal Year 2025
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Record assets under management and strong net new money drove a 17% rise in pre-tax profit, with improved cost efficiency and robust capital ratios. Asia led regional growth, while ongoing regulatory review and IT investments shape the outlook.
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Record AUM and strong net new money drove a 17% rise in pre-tax profit, with cost discipline and capital strength supporting improved financial ratios. Strategic transformation and efficiency programs are on track, with growth momentum in key regions and a clear path to midterm targets.
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Strong operating results with record assets under management and improved cost efficiency were reported. The credit review is complete, with CHF 149 million in provisions for legacy real estate loans, and a strengthened risk framework is in place. Net new money growth is slightly below target, but hiring and efficiency initiatives support future growth.
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Half-year 2025 results show doubled net new money and 11% growth in underlying net profit year-on-year, despite a 35% drop in IFRS net profit from one-off items. Cost efficiency improved, and the company remains on track for CHF 130 million in cost savings.
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Underlying net profit grew 11% year-on-year, with net new money inflows more than doubling and cost-saving measures delivering results. AUM declined 3% due to currency effects and the Brazil sale, while the CET1 ratio improved to 15.6%. Guidance for net new money and cost-income ratio remains unchanged.
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Leadership outlined a transformation plan focused on core wealth management, disciplined risk and cost management, and digital innovation. New medium-term targets include 4-5% net new money growth, a cost-to-income ratio below 67%, and a return on CET1 above 30%.
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Credit portfolio review is nearly complete, with no significant new risks identified and provisions spread across several clients. Financial performance shows improved margins and capital ratios, while de-risking and cost initiatives continue. Management is refocusing on core wealth management and will provide a strategy update on June 3rd.
Fiscal Year 2024
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Leadership is driving a strategic overhaul with a resized Executive Board, extended cost program, and a comprehensive review to address performance and efficiency. Net new money growth is expected to be muted in 2024, with 300-400 job cuts planned, while the dividend remains stable.
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Record AUM and solid profit growth were achieved despite higher costs and margin pressure, with strong net new money from key markets and a focus on operational efficiency. The cost program was extended, and capital ratios remain robust, though Basel III final will temporarily impact CET1.
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Net new money growth accelerated, supported by both new and seasoned relationship managers, with year-end growth expected between 3%-4%. Margins remained stable despite lower gross margin and currency headwinds, while the CET1 ratio improved to 16.7%. Share buybacks await regulatory review completion.
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H1 2024 saw a return to growth with CHF 3.7bn net new money, improved cost-income ratio, and strong capital metrics, despite lower net interest income and profit year-over-year. Strategic cost savings, business streamlining, and robust hiring support a positive outlook.