The head of investment management at Julius Baer Asset Management, which is expected to be split from the Swiss firm’s private banking arm later this year, is hoping to seize growth opportunities in the regions with existing activities and additionally in selected markets in Eastern Europe and Asia.

Stefan Angele, head of investment management, relishes the greater freedom of action he expects after a split in the firm’s operations, subject to shareholder approval on 30 June. Julius Baer announced in May that all private banking activities will be grouped and listed under Julius Baer Group, while hedge fund arm GAM, US asset management unit Artio and Julius Baer Asset Management Europe will be combined into a listed firm, GAM Holding. Julius Baer plans to hold an initial public offering of Artio when market conditions are right.

“There are several markets where we are trying to increase our activity. Besides a dedicated growth strategy in the markets where we are already established, we are thinking about selectively increasing our exposure in Eastern Europe and Asia but we are very opportunistic,” Mr Angele, told WealthBriefing in a recent interview at one of Julius Baer’s offices in Zurich.

“We are looking primarily at organic growth right now but are always open to acquisitions. With the IPO of Artio Global in the US, we will have some room to manoeuvre. We are basically business-driven and if there is a good opportunity…well, in the current environment asset managers are a lot cheaper then a few years ago. But any acquisitions would have to fit strategically," he said.

Julius Baer Holding has already taken over two companies this year. In April, it bought fixed income manager Augustus back from its founders after the London firm’s assets halved in six months. In May, Julius Baer bought Milanese firm Alpha SIM, which merges with the local Julius Baer private banking operation. Mr Angele says he is not currently considering any bids but bargain basement prices and an upcoming flotation may tempt him before the end of 2009.

Mr Angele said the split between the bank and the asset management divisions will create more chances to acquire new clients. “With the separation of the two companies, we will have access to other client bases that were previously reluctant to work with us because of our captive channel [the private bank]. But as an independent asset manager, clients that were not open to working with Julius Baer may be more willing,” he said.

While Julius Baer has not been hit as hard by the financial market turmoil as some of its peers, it is nevertheless looking to change its business model to improve its profits. A number of banks have been selling asset management operations or putting them on a more autonomous footing: last week, for example, Barclays, the UK bank, agreed to sell its US-based fund manager Barclays Global Investors to US-listed BlackRock.

There has been some speculation about a possible sale of London-based GAM but Mr Angele said this was not on the cards.

“There will always be speculation but all I can say is if an offer price was right, it  might be considered. And we are not considering anything,” Mr Angele said.

GAM focuses on alternative and absolute return investments and experienced strong net outflows last year, particularly in the final quarter, due to high risk aversion among investors and the extreme liquidity problems that now define the period. These factors, coupled with the adverse impact of currency changes, saw assets under management fall to SFr42 billion (about $39 billion) at the end of 2008 from SFr86 billion the year before.

Mr Angele is unruffled by the move to split Julius Baer: “One of the reasons I think this split will not be so painful for us is that only a minor stake of our equity holdings are invested in our captive channel, unlike other asset managers connected to a private bank. We have more than 80 per cent of our assets with external clients,” Mr Angele said.

“We rely on external clients because we want to be competitive. With external clients we are competing with every asset manager in the world. Ours isn’t a nice, cosy workplace with an in-house captive channel buying products whether they are good or bad,” he said.

“For me [keeping the private bank at arm’s length] gives me room to manoeuvre, to define my own product strategy. I’m not so dependent on my in-house captive channel that if they have a problem or are taken over or even buy in other asset managers, I need to worry. I have such a broad client base, I’m relaxed,” he added.