Julius Baer Increases Stake To 80 Per Cent In Brazilian Wealth Manager

Tom Burroughes

25 March 2014

has acquired an additional 50 per cent of São-Paulo-based GPS Investimentos Financeiros e Participações, raising the Swiss private bank’s stake in GPS to 80 per cent from the 30 per cent acquired in May 2011.

The Zurich-listed bank said this increase follows a “highly successful cooperation to date and underscores Julius Baer’s strategic goal of building a leading wealth management business in Brazil, one of the most attractive domestic wealth management markets worldwide and the largest wealth management market in Latin America”.

GPS, which includes GPS Planejamento Financeiro Ltda. and CFO Administração de Recursos Ltda, is the largest independent wealth manager in Brazil with approximately BRL15 billion ($16.45 billion) of assets under management, according to a statement from Julius Baer today.

The increased stake represents another example of how Julius Baer, which has been integrating its acquisition of Bank of America’s non-US wealth management business it has bought, has been bulking up its operations worldwide. The bank also has a partnership deal with Australia’s Macquarie in a bid to expand its Asia footprint.

GPS, which employs a total staff of over 120, was established as a partnership in 1999 by its three founding partners José Eduardo Martins, Marco Belda and Roberto Rudge. GPS’s operative business is regulated by CVM, the Securities and Exchange Commission of Brazil.

The partners of GPS will continue to lead the business as it is integrated into Julius Baer’s overall corporate structure and culture. Julius Baer senior executives will assume a majority in the board of directors of the company and will also appoint two members to the executive committee of GPS. GPS will continue to operate under its well-established and respected brand.

GPS is profitable, and the transaction is expected to deliver a low single-digit accretion to Julius Baer Group’s adjusted earnings per share in 2014 and will have a limited impact of approximately 60 basis points on Julius Baer Group’s current BIS capital ratios, Julius Baer’s statement said.

Julius Baer’s total client assets amounted to SFr348 billion ($394.9 billion) at the end of 2013, including SFr254 billion of assets under management.