Julius Baer books 43% profit jump as pandemic boosts trading

Credit: REUTERS/ARND WIEGMANN

Adds further detail from statement

ZURICH, July 20 (Reuters) - Active client trading during the coronavirus pandemic helped Julius Baer BAER.Spost a 43% rise in half-year net profit to 491 million Swiss francs ($523.01 million) on Monday, a record result for the Swiss wealth manager.

"With the full economic impact of COVID-19 still ahead of us, we are confident that we are well prepared for a challenging second half of the year," Chief Executive Philipp Rickenbacher said in a statement. "We are well positioned to maintain the stability of our business."

Baer in May had announced an "exceptional increase" in trading volumes among its wealthy clients through April, helping it boost margins despite a hit from sliding markets and a strong Swiss franc eating into its assets under management.

Switzerland's third-largest listed lender on Monday said assets under management fell 6% from end-2019 in the six months through June to 401.8 billion francs. Fresh client inflows of 5.0 billion francs--particularly from clients in Europe and in Asia--failed to offset those negative effects.

Operating income rose 9% as the rise in revenues from a spike in client activity offset lower net interest income and higher credit losses on financial assets.

The bank over the period outperformed nearly all its medium-term financials, improving its adjusted cost/income ratio to 66.6% from 71.0% during the first half of 2019. It is aiming for a cost/income ratio below 67% by 2022.

($1 = 0.9388 Swiss francs)

(Reporting by Brenna Hughes Neghaiwi)

((brenna.neghaiwi@thomsonreuters.com; +41 58 306 77 35;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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