Julius Baer posts profits drop over fine in US tax-dodging case
Swiss private bank Julius Baer said Monday that net profit plummeted in 2015 due to a provision linked to a US probe into the bank's suspected role in helping Americans evade taxes.
The bank said net profit dropped 67 percent to 121.2 million Swiss francs (109 million euros, $119 million) last year.
The fall comes after the Zurich-based bank put aside a provision of just over $547 million to cover a fine it faces as a settlement in the US criminal investigation.
Authorities around the world have been clamping down on tax evasion in the wake of the global financial crisis.
Chief Executive Boris Collardi said in a statement that the bank expected it would "soon be able to complete the court process and announce the final resolution" following the final approval of the settlement.
Julius Baer was among around a dozen Swiss banks placed under criminal investigation by the US Justice Department, including the country's second largest bank Credit Suisse, which was slapped with a $2.8-billion fine.
Without the US provision, Julius Baer said profits would have grown last year by a fifth to just over 700 million Swiss francs.
While acquisitions in the banking sector have slowed in Switzerland over the past year, Julius Baer has remained very active on this front.
The group's acquisitions have included the activities in Switzerland of Israel's Leumi Private Bank, the Geneva bank Fransad, the German activities of Commerzbank at Luxembourg and an increase in its stake in Italy's Kairos bank.
Julius Baer has also finalised its integration of the wealth management operations that it bought four years ago from US investment bank Merrill Lynch.
"We will take a careful look at targets," Collardi told journalists and analysts at a conference in Zurich Monday about possible more acquisitions.
"Big elephants don't cross the road that often."
He added however that "there are a cluster of large banks that are not doing so well these days... Something might come on the table".
When asked about the FIFA investigation, Collardil explained that the bank was cooperating with the authorities without commenting further as the inquiry is currently under way.
Julius Baer is part of a list of several banks that were cited in the indictment against top officials of international football federation over alleged bribes.
"An investigation has been launched, also for us internally," said Collardi, noting that the bank has dismissed a client adviser.
"There are no reasons for fears," he added.
In mid-afternoon trade, shares of Julius Baer were down 3.24 percent in Zurich with the overall market there slipping 0.25 percent.
© 2016 AFP