Swiss private bank Julius Baer has announced a 19 per cent drop in net profit to SFr183 million ($138 million) in 2002.This content was published on March 12, 2003 - 11:32
The group said on Wednesday that difficult market conditions had reduced revenues and assets, and would force it to slash its workforce by around 300.
Julius Baer had forecast last year that net profit would be considerably less than the SFr225 million achieved in 2001. Analysts had expected 2002 profit to come in at around SFr190 million.
The bank said the slump in the international equity markets had affected it badly, reducing assets under management by 16 per cent to SFr106 billion.
"In view of the persistently tough operating conditions, Julius Baer will reduce its personnel capacity by at least another ten per cent, lowering the number of employees to below 2,000 by the end of the year," it said in a statement.
CEO Walter Knabenhans said the bank remained in a "strong position" thanks to its focus on promising European markets and the prudent risk strategy it had followed during times of market fluctuation.
But despite this, Knabenhans was only able to express "limited confidence" for the current year.
"If operating conditions do not soon take a decisive and sustained turn for the better, net profit for the current year will turn out to be considerably lower than that of 2002," he said.
The bank announced 150 job cuts at the end of last year following 145 job losses in 2001.
Like other small private banks, Julius Baer has struggled with high costs and a drop in assets, and has been forced to cut costs.
The general crisis affecting Switzerland's small banks has resulted in several mergers, including that involving Geneva's oldest private banks, Lombard Odier and Darier Hentsch.
swissinfo with agencies
Julius Baer said 2002 net profit fell 19 per cent to SFr183 million.
Analysts had predicted profit of around SFr190 million.
The bank said it would cut ten per cent its workforce by the end of the year.
It blamed market uncertainty and lower assets for the fall in profit.