To stay at the forefront of an industry for over 125 years requires more than a fair idea of the path forward. For Julius Baer, it took a number of visionary decisions by courageous leaders to successfully transform the local family business into a public company and ultimately into the international reference in private banking.

The early years

Recognising the importance of Zurich as a centre of international trade, Julius Baer, founder and namesake of the Group, opened shop on Zurich’s famous Bahnhofstrasse in the 1890s. What initially started as a small bureau de change rapidly expanded into wealth management and securities and FX trading – business activities that still remain at the core of the Julius Baer Group today.

Growing the business

Parallel to the strong economic growth and technological progress after World War II, the company – then a partnership comprising a rising number of Baer family members – began expanding internationally in 1940 and thus laid the first building blocks of today’s global business. The need to finance this rapid growth drove Julius Baer in 1980 to become the first Swiss private bank to go public.

Gearing up

The majority of the voting rights from the initial public offering remained within the Baer family pool, however, thus ensuring full control of the Group going forward. This only changed at the beginning of 2005, with the introduction of the 'one share, one vote' principle. This new financial leeway was utilised in the same year for the acquisition of three private banks and a specialised asset manager, which together were even larger in size than Julius Baer itself. Exploiting this massively increased scale, Julius Baer started expanding rapidly into global growth markets, particularly Asia, and achieved strong growth momentum in the following years.

Recalibration

The 2008 credit crisis ushered in a fundamentally changing business environment. This led Julius Baer to take a rather unorthodox step. By separating the Group’s asset management and private client businesses in October 2009, each individual business was provided with precious strategic flexibility in the early stage of this new cycle. The private banking business became the independent Julius Baer Group Ltd. and began systematically broadening its international presence and specialised offering via acquisitions and a number of strategic cooperation agreements around the globe.

"If contact between
people is based on trust and absolute integrity, then it is
of benefit for both sides."
Julius Baer, Founder

Quantum leap

In August 2012, Julius Baer initiated the next phase of its growth by acquiring Merrill Lynch’s International Wealth Management (IWM) business outside the US. IWM provided a rare opportunity to substantially increase the Group’s footprint in established markets, a number of new markets and in growth regions. This growth enabled the Group to further increase its leading position in a highly competitive industry, to provide clients with an unparalleled product and services offering and to tackle any future challenges from a position of strength – as the international reference in private banking.

Seizing opportunities

In addition to fostering organic growth, Julius Baer continued to look at opportunities to enter promising new markets. Since 2010, Julius Baer has successfully established a presence in Brazil (through the staggered acquisition of GPS, topped with the acquisition of a 95% stake in Reliance Group at the beginning of 2018) and in the Mexican wealth management market (through a 40% participation in NSC Asesores in 2015), set foot in Italy (Kairos, initiated 2012, today 100% ownership), Japan (initiated 2015, subsidiary since 2016) and Luxembourg (acquisition of Commerzbank International S.A. Luxembourg in 2015, the nucleus of the Group’s new European hub). Finally, at the beginning of 2018, Julius Baer entered its first strategic joint venture, with Siam Commercial Bank in Thailand.

Keeping the momentum

While the overall stability of the financial industry greatly improved in the years following the financial crisis, for many banks the struggle to find the right business model suitable for the new, harsher environment was not yet over. Size continued to be the decisive factor to profitability in any business field in international banking. As a result, many larger players started to trim their sub-par private banking activities. Julius Baer took full advantage of this industry consolidation and competitive dynamics in 2016 by hiring a very substantial number of experienced relationship managers, particularly in Asia. This successful push strongly contributed to solid financial results in the following years and was perpetuated at a slower yet still ambitious pace.