Julius Baer Gruppe AG · SIX:BAER
Julius Baer Gruppe — Julius Baer Holding — UBS Banking Conference New York 2000
36 slides from Julius Baer Gruppe's conference presentation, Jun 27, 2000
Slide 1: The Julius Baer Group
The Julius Baer Group Presentation by Rudolf E. Baer Chief Executive Officer Julius Baer Holding Ltd. 27 June 2000
Slide 2: History
History l Bank Julius Baer founded in 1890 l Incorporation in 1975 l Going public of Julius Baer Holding in 1980 l Business of the 80s: Private banking, trading, commercial lending l Business of the 90s and today: Asset Management (private banking, institutional asset management, mutual funds), brok
Slide 3: Company controlled by the Baer family
Company controlled by the Baer family Family owns majority of Bearer shares by region company through votes (registered shares are not listed) North America Votes 54% 47% 25% Switzerland Rest of 50% Europe Capital 19% 81% 25% Family (incl. staff) Public Listed on the Swiss and Frankfurt stock exchan
Slide 4: Key figures (12.99)
Key figures (12.99) l Assets under management (3.00) CHF 147 bn l Shareholders' equity CHF 1.4 bn l Net profit CHF 268 mn l Market capitalization (6.00) CHF 6.6 bn l Staff 2008 4
Slide 5: Presence in major financial markets
Presence in major financial markets Switzerland Rest of Europe Overseas London Hong Kong Montreal Amsterdam Zurich Guernsey Lucerne Frankfurt Basle San Francisco Bern Paris New York Madrid Los Angeles Vienna Milan Geneva Palm Beach Monaco Lausanne Lugano 5
Slide 6: Assets under management: CAGR 20% (10 years)
Assets under management: CAGR 20% (10 years) CHF bn 160 147 Expected long-term 140 growth rate: 128 120 ~15% p.a. 95 100 81 80 64 60 49 45 46 40 30 33 26 20 0 90 91 92 93 94 95 96 97 98 99 3/00 Global custody of CHF 30.3 bn (12.99) not included 6
Slide 7: Revenues and net profit growth
Revenues and net profit growth Revenues Net profit (CHF mn) (CHF mn) 1400 300 1200 250 1000 200 800 150 600 100 400 200 50 0 0 90 91 92 93 94 95 96 97 98 99 90 91 92 93 94 95 96 97 98 99 Tax effect 7
Slide 8: Dividend per bearer share (in CHF)
Dividend per bearer share (in CHF) 80 73 69 70 60 52 50 39 40 33 30 30 30 23 25 21 20 10 0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 8
Slide 9: Private banking
Private banking l Average portfolio size CHF 2.5 to 3 million l Personal relationship l Personal service l Career planning for the account executives l Maintain continuity in private banking staff 9
Slide 10: Service and relationship: the key drivers
Service and relationship: the key drivers Principal reasons to select your bank now and in 5 years time: Rank now Rank Rank in 5 years Personal relationship 1 Service quality Image 2 Personal relationship Service quality 3 Investment performance Recommendation Recommendation from client 4 from clien
Slide 11: Overall gross fee margin (in bps)
Overall gross fee margin (in bps) 60 51 52 50 47 42 42 40 30 20 10 0 95 96 97 98 99 11
Slide 12: First-time segment reporting for 1999
First-time segment reporting for 1999 l Segmental reporting has to follow internal organizational structure l All segmental reporting in the appendix of the presentation Private banking l Policy of not growing through acquisition l Organic growth l Money inflow: predominantly in Q4 1999, i.e. full e
Slide 13: Onshore vs. Offshore
Onshore vs. Offshore l Servicing the clients locally does not necessarily mean an onshore presence in all the respective markets l Processing of accounts centralized as much as possible in Zurich (for Europe) and in new York (for the U.S.) l Switzerland can certainly compete effectively in money man
Slide 14: Institutional asset management: focus on Europe
Institutional asset management: focus on Europe Businessdevelopment Business development Confederationof Confederation of Assetmanagement Asset managementcenters centers assetmanagers asset managers followingdiversified following diversified investmentstyles investment styles London London Frankfurt
Slide 15: Baer Funds
Success through customized client solutions JuliusBaer Julius BaerAsset AssetMgmt, Mgmt,Zurich Zurich 60 Institutional assets (CHF,inin% (CHF, %p.a.) p.a.) 1999 95-99 1999 95-99 + 57% 49.4 Globalequities Global equities 50 Performance Performance 63.0 63.0 27.4 27.4 CHF bn Benchmark Benchmark 45.6 4
Slide 16: Performance of stock funds (in base currency)
Performance of stock funds (in base currency) Base Performance currency 1999 1.1.-31.5.2000 Special Europe Stock Fund EUR +175.3% +10.1% Special German Stock Fund EUR +103.8% +13.1% Japan Stock Fund JPY +76.1% -7.0% Pacific Stock Fund USD +66.5% -17.1% Special Swiss Stock Fund CHF +65.8% +33.4% Glob
Slide 17: Partner distribution
Continued strong growth in mutual funds CHF bn 40 34.3 JB clients 35 CAGR90-99 CAGR 90-99::40% 40% 30 Long-term ::20%+ 20%+ 28.0 Long-term 25 Partner distribution 20 16.4 15 10.5 10 5.4 6.9 4.8 5.0 5 3.1 1.4 2.0 0 90 91 92 93 94 95 96 97 98 99 3/00 17
Slide 18: Cooperation with partners: four basic models
Cooperation with partners: four basic models Julius Baer funds Private label funds (2/3 of partner volume) (1/3 of partner volume) 1. Partners sell one or several 4. Baer establishes and, in some Julius Baer funds to their clients cases, manages private label 2. Partners use a range of Julius funds
Slide 19: Swiss mutual funds market
Swiss mutual funds market Market Share Change 1998 1999 98/99 1. UBS 54.1% 47.2% -12.8% 2. Credit Suisse 22.2% 22.8% 2.7% 3. Swissca (Cantonal Banks) 7.4% 8.2% 10.8% 4. Julius Baer Group 4.1% 5.6% 36.6% 5. Lombard Odier 1.9% 2.7% 42.1% 6. Vontobel 2.3% 2.4% 4.3% 7. BSI 1.0% 1.4% 40.0% 8. Sarasin 1.2
Slide 20: Business line structure and activities (1)
Business line structure and activities (1) PrivateBanking Private Banking Inst.Asset Inst. AssetMgmt Mgmt MutualFunds Mutual Funds Institutional clients Marketingto Marketing tothird- third- Institutional clients partydistributors distributors party Privateclients Private clients and and Management
Slide 21: Pension funds assets in % of GDP
21 0% 20% 40% 60% 80% 100% 120% Ita ly Sp ai n Fr an c e G er m an y Sw ed en I re la nd U N K et he rla nd Pension funds assets in % of GDP Sw s itz er la nd Ja pa n U SA
Slide 22: Business line structure and activities (2)
Business line structure and activities (2) Trading/Brokerage Trading/Brokerage Resources Resources Corp.Functions Corp. Functions Inst.Brokerage Inst. Brokerage Finance/Controlling Finance/Controlling Securitiestrading Securities trading Information Information Humanresources Human resources technol
Slide 23: Market turnover of continental European markets
Market turnover of continental European markets 1996 Q1 2000 SP SWI SP SWI NL 12% 14% 8% 19% NL 10% 9% ITA 5% GER FRA ITA 38% 14% GER 18% 40% FRA 14% Source: SWX; universe: markets mentioned 23
Slide 24: Inst. brokerage: focus on continental Europe
Inst. brokerage: focus on continental Europe ••Country Country++pan-European pan-Europeansectorsectorresearch research ••No Nocorporate corporatefinance/M&A finance/M&Aabroad abroad ••Critical Criticalmass massreached reached(100(100sales salespeople people 60analysts, 60 analysts,800 800institution
Slide 25: Business line structure and activities (2)
Business line structure and activities (2) Trading/Brokerage Trading/Brokerage Resources Resources Corp.Functions Corp. Functions Inst.Brokerage Inst. Brokerage Finance/Controlling Finance/Controlling Securitiestrading Securities trading Information Information Humanresources Human resources technol
Slide 26: Internet
Internet Private clients l Access to the portfolios and research (Q4 2000) Institutional clients (e.g. brokerage) l Information providing (shortly) Trading l Europe still very fragmented l Regulatory requirements differ l Account opening procedures complicated 26
Slide 27: Group P&L: Revenues commission driven
Group P&L: Revenues commission driven Net operating income Breakdown 1400 + 17% 1212 net operating income 1200 1040 1000 CHF mn 846 Commissions 800 70 (67)% 598 600 524 400 200 Net interest Trading 12 (13)% Other 16 (17)% 0 2 (3)% 95 96 97 98 99 Proprietary trading 6% of revenues 27
Slide 28: Group P&L: Staff expenses reflect good results
Group P&L: Staff expenses reflect good results Staff expenses General expenses 284 600 300 1999:+ 24% 1999:+ 24% 497 500 CHF mn 250 CHF mn 230 401 194 400 200 327 150 300 150 130 251 219 200 100 Bonus 100 50 0 0 95 96 97 98 99 95 96 97 98 99 28
Slide 29: Summary and outlook
Summary and outlook l Share buy-back program continues. So far shares bought back for CHF 380 mn l Julius Baer well positioned in the growth market Europe which will provide further excellent business opportunities in all areas of asset management l Assets under management and the resulting bottom l
Slide 30: www.juliusbaer.com
www.juliusbaer.com Contact: Jan A. Bielinski Julius Baer Holding Ltd. Phone: +41 1 228 55 01 Senior Vice President P.O. Box. Fax: + 41 1 201 51 20 Corporate Communications CH-8010 Zurich, Switzerland jan.bielinski@juliusbaer.com and Investor Relations www.juliusbaer.com
Slide 31: Appendix 1: Group profit and loss account
Appendix 1: Group profit and loss account CHFmn CHF mn 1998 1999 Change 1998 1999 Change Netinterest Net interestincome income 140 144 3% 140 144 3% Commissions/servicefees Commissions/service fees 693 852 23% 693 852 23% Resultsfrom Results fromtrading tradingoperations operations 175 190 8% 175 19
Slide 32: Appendix 2: Segment reporting overview
Appendix 2: Segment reporting overview CHF mn Priv. Inst. Inv. AM Trad./ Corp. Group Bank Asset Funds total Brok. Cent. total Net operating income 449 133 97 678 464 70 1212 Operating expenses 305 69 39 413 270 133 816 Result before taxes 144 64 58 265 194 -63 396 Taxes 33 20 15 68 59 -12 115 Result
Slide 33: Segment reporting Private Banking
Segment reporting Private Banking CHF mn 1998 1999 +/- Net operating income 426 449 5% Operating expenses 273 305 12% Segment result before taxes 153 144 -6% Taxes 13 33 157% Segment result after taxes 140 111 -21% Assets under management (bn) 55 67 21% of which mgmt of Baer funds 2 2 2% Number of s
Slide 34: Segment reporting Inst. Asset Management
Segment reporting Inst. Asset Management CHF mn 1998 1999 +/- Net operating income 103 133 29% Operating expenses 58 69 19% Segment result before taxes 45 64 43% Taxes 8 20 143% Segment result after taxes 37 44 20% Segment result after minorities 32 39 21% Assets under management (bn) 32 49 57% of w
Slide 35: Segment reporting Mutual Funds
Segment reporting Mutual Funds* CHF mn 1998 1999 +/- Net operating income 62 97 55% Operating expenses 30 39 30% Segment result before taxes 32 58 78% Taxes 1 15 - Segment result after taxes 31 43 37% Segment result after minorities 27 37 37% Assets under management (bn) 16 28 71% Number of staff 71
Slide 36: Segment reporting Trading / Brokerage
Segment reporting Trading / Brokerage CHF mn 1998 1999 +/- Net operating income 389 464 19% Operating expenses 202 270 33% Segment result before taxes 187 194 4% Taxes 37 59 60% Segment result after taxes 150 135 -10% Minority interest 0 2 - Segment result after minorities 150 133 -11% Number of sta
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