Swiss private banking group, Julius Baer has decided to close its booking centre in The Bahamas capital, Nassau, sending home its 30 strong staff.
“Julius Baer will no longer have a presence in The Bahamas once the liquidation process has been finalised,” the company said in a statement today. “The decision to close our office in The Bahamas is a purely commercial decision based on future growth potential,” the statement said.
The decision follows the statement by Julius Baer CEO, Philipp Rickenbacher that the wealth manager will slash 300 jobs this year after its net profit slumped. The news comes exactly a year after the Swiss private bank announced it was cutting 100 jobs as it grapples with lower growth.
“All employees have been made aware of this decision today. The Group will assist them throughout this process and continues to rely on their professionalism and support.”– Julius Baer
The Zurich-based private banking firm’s net profit slumped 37 per cent to Swiss Franc (CHF) 465 million in 2019 on a year-on-year basis. The job cuts are part of Rickenbacher’s three-year plan to improve the bank’s profit margins.
Since becoming CEO in September, Rickenbacher has reduced the size of the Baer’s executive board to boost efficiency and client focus, particularly on ultra-wealthy clientele. The bank now plans to “shift from an asset-gathering strategy to one focused on sustainable profit growth”.
The company stated said, “the booking centre will remain operative for an appropriate period of time in order to allow for an orderly dissolution of the business. The Group is committed to offer all affected clients a suitable alternative.”
“All employees have been made aware of this decision today. The Group will assist them throughout this process and continues to rely on their professionalism and support. After the longstanding commitment to The Bahamas, Julius Baer has not taken this decision lightly and regrets the impact of this group-wide programme on local staff and clients,” the bank said in a statement.
As part of its new cost-cutting strategy, Julius Baer eyes CHF200 million in cost cuts over the next three years. Reviewing geographic presence is one of the key parts of the wealth manager’s strategy to achieve its targets.
“It’s about 30 employees that will be impacted. Julius Baer will conduct a professional liquidation process. This will take time, so the job cuts will be staggered. The affected employees will receive severance packages,” tribune242.com quoted a spokesperson of the bank as saying.