Zurch, Switzerland (GenevaLunch) - Bank Julius Baer joins the growing ranks of Swiss banks moving out of the US client managed wealth business. The bank announced that it has begun a gradual shift away from American customers, but the move is not hurting the bank’s overall wealth under management: the bank reports that in the first 10 months of 2009 total client assets increased to CHF234 billion and assets under management rose to some CHF 150 billion, up 17%, compared to a year earlier.

Spokesperson Martin Somogyi told GenevaLunch that details about the US client business are not available now, although the bank may provide them when it releases 2009 full year results in February 2010. He clarified that US citizens resident in Switzerland “who are tax compliant” are not part of this group and will remain bank clients.

Some Swiss banks in recent months have told clients who are US citizens and resident in Switzerland that their accounts will be closed, to avoid the expense and hassle for the bank of complying with complex US tax requirements. Somogyi suggests that the situation for Julius Baer may be easier than that of the big banks, notably Credit Suisse and UBS, because Baer does not have US onshore banking business.

The bank has not said what percentage of its clients are US citizens but according to the Geneva Financial Centre, US clients account for only about 1 percent of Swiss banks’ assets under management.

The Julius Baer figures published Tuesday 10 November do not include the bank’s recent acquisition of Dutch bank ING’s wealth management business, which the Zurich bank says is still on target to be completed in early 2010.

The growth in client assets has nevertheless slowed, which the bank says in a news release is due to several factors, including tighter interest rate spreads and “the fact that clients are still substantially invested in cash or cash-equivalent products.” It also notes that the “generally tense regulatory environment in some of the European countries” is resulting in some clients moving money out, but the bank is not providing details about the nationalities or giving figures.

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