Julius Baer seeks ways to increase presence in Latin America after GPS purchase

Tuesday, May 10, 2011

Swiss private banking group Julius Baer may consider expanding its reach in Latin America through a purchase, finding new partners or through organic growth following its recent acquisition of a minority stake in GPS, Brazil's largest independent wealth manager, head of media relations Jan Vonder Mühll told BNamericas.

"We see Latin America as an interesting region, and we will clearly follow the developments and look at potential opportunities," he said.

Earlier this month, the group announced its entry into Brazil by acquiring a 30% stake in São Paulo-based GPS for an undisclosed sum.

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"Clearly we see this participation as a strategic market entry. We want to be active in Brazil and, in some way or another, we want to increase our presence there," Vonder Mühll said, adding that the decision will be taken jointly with GPS.

Julius Baer already has a strong foothold in Asia and has set the foundations to become more active in Latin America. The bank has been operating in Chile since late 2008 and also has representative offices in Buenos Aires, Caracas, Lima and Montevideo.

"Brazil is a different story in terms of scale and magnitude, because what we want to do is to go onshore. We made that public about a year ago, and now with GPS we have found a very good partner for that," he said.

"For us it is really about learning more about the Brazilian market and gaining experience on how that market functions and what are the client's particular needs. And we believe we can both benefit from this joint venture as we bring our global expertise and platform to GPS' domestic know-how."

GPS has some 8.5bn reais (US$5.3bn) in assets under management and includes GPS Planejamento Financeiro and CFO Administração de Recursos.


Julius Baer focuses exclusively on private banking, and having a similar culture to GPS' was a key driver behind its decision to acquire a minority stake in the Brazilian wealth manager.

"That will not change, and we will not try to acquire a brokerage or institutional or investment banking business. We will only focus on wealth management and private clients," Vonder Mühll said.

In contrast to other Latin American markets, a good chunk of Brazil's attractiveness relies on its onshore opportunities.

"People want to bank onshore. We see the current size of the market of investable assets from high net worth individuals at around US$900bn," the executive noted.

"From the political framework and stability, we see a very positive story in Brazil. And we believe the country's GDP will grow 4-5% annually over the next few years, enabling wealth creation to keep growing in the foreseeable future and creating interesting opportunities for wealth managers," Vonder Mühll said.

Julius Baer focuses exclusively on private banking and asset management and family offices, operating in some 40 locations in more than 20 countries. It had total client assets of 267bn Swiss francs (US$305bn) and assets under management of 170bn Swiss francs as of end-2010.