June 11, 2018 / 1:05 PM / 2 months ago

Swiss bank Julius Baer says Europe matches Asia for new business

* Bank Julius Baer looking to M&A, hiring and branch openings to expand in Europe

* Wealth manager’s net new money growth in Europe matching or outpacing Asia

* Baer opening two new branches in Germany

By Brenna Hughes Neghaiwi and Angelika Gruber

ZURICH, June 11 (Reuters) - Swiss private bank Julius Baer plans to expand its footprint in Europe where it says it is attracting as much new business as in high-growth Asia.

The head of Baer’s European business, Yves Robert-Charrue, told Reuters that the bank plans to expand in Britain, Germany and Spain, by hiring, opening new branches and potentially by M&A activity if it sees opportunities. It will also continue investing in technology at its European offshore booking centre in Luxembourg.

“I’m in a little bit of a competition with my colleague running Asia to see who’s stronger in the long term,” Robert-Charrue said during a recent interview at the bank’s headquarters in Zurich. “I would not exclude an acquisition to leapfrog the growth we think we can achieve, if the conditions are right. There’s potential for further hiring in big strategic markets.”

Baer is Switzerland’s third-largest listed bank with 401 billion Swiss francs ($407 billion) in assets under management at the end of April and said last month that its net money inflows had increased by more than an annualised 5 percent in the first four months of this year. It has not given further details.

European and Asian customers account for roughly a quarter each of the group’s assets under management, according to sources.

While for the wealth management industry as a whole, growth in Europe has lagged Asia, Robert-Charrue said that was not the case for Baer which has been able to use its position as a new entrant to some European markets with a relatively small market share to grow.

In Germany, Baer plans to open a branch in Hanover and another at an undisclosed site, he said, giving the group 11 offices in Europe’s biggest economy.

“The German business, the operational business of our onshore franchise, has been profitable for many years. Other markets are profitable in terms of legal entities,” Robert-Charrue said. “Top-line margins are strong, which maybe not everyone would expect in Europe. We can deliver very strong return on assets in Europe, and to me that proves a point.”

Last year Baer decided to open three new offices in Britain - going against the trend of the financial industry, which is shifting some operations from London ahead of Britain’s exit from the Europe Union.

Baer - which primarily books domestic business in Britain and runs its European cross-border operations out of Luxembourg - will continue looking for opportunities, saying its bid to seize a greater chunk of business from wealthy Britons spooked by Brexit uncertainty is showing early signs of success.

“We think it’s good sometimes to go a bit against the trend. That also helped us on hiring,” Robert-Charrue said of the expansion.

He joined the bank in 2009 when his former Credit Suisse colleague Boris Collardi became CEO of Baer. He said he is not overly concerned about losing clients and client managers as Collardi becomes a partner at rival bank Pictet this month.

“Obviously, it’s a competing market out there. We’re neither afraid nor see it as a major threat,” he said. “We’re very close to our employees and our clients and we’re watching.” ($1 = 0.9857 Swiss francs) (Reporting by Brenna Hughes Neghaiwi; Editing by Susan Fenton)

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