Swiss private banking group Julius Baer Group Ltd. (JBAXY, JBARF) plans to cut up to 880 jobs at Merrill Lynch's overseas wealth management business as the integration of the unit with Julius Baer commences, according to a report in the Swiss newspaper Der Sonntag.
Julius Baer said in mid-August that it agreed to buy Merrill Lynch's international wealth management unit outside the U.S. from Bank of America Corp. (BAC) for about 1.47 billion Swiss francs. The bank expects the acquisition to strengthen its private banking position in growth markets of Asia, Latin America and the Middle East as well as in Europe.
Boris Collardi, Chief Executive Officer of Julius Baer, recently told an investor meeting that between 30 and 40 percent of the unit's total number of jobs will have to be eliminated.
The wealth management unit, which was expanded significantly after Bank of America's purchase of Merrill Lynch & Co. in 2009, has about 2,200 employees. The job cuts thus amount to up to a total of 880.
The job cuts are seen as necessary so that Julius Baer can reduce its cost-income ratio to a planned 70 percent from 100 percent. Julius Baer faces reportedly faces substantial overlaps in Singapore, Hong Kong, Switzerland and London.
Bank of America acquired Merrill Lynch's international wealth management business outside the U.S. as part of its purchase of Merrill Lynch & Co. in 2009. On its part, Bank of America has been selling non-core business units and cutting thousands of jobs as part of its efforts to reduce costs and bolster capital.
JBAXY closed Friday's trading at $7.13, up $0.03 or 0.42 percent on a volume of 13,916 shares.
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