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Julius Baer to separate private banking and asset management businesses

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The board of directors of Julius Baer Holding has decided to separate its private banking and asset management businesses into two fully independent entities, both individually listed o

The board of directors of Julius Baer Holding has decided to separate its private banking and asset management businesses into two fully independent entities, both individually listed on the SIX Swiss Exchange.

Julius Baer Group will focus on private banking services while GAM Holding will concentrate on active asset management.

The board says the move will substantially increase the two companies’ strategic flexibility and enhance their market visibility.

The transaction is expected to be completed during the third quarter 2009, subject to shareholder and regulatory approvals. The transaction is not expected to result in any redundancies.

Julius Baer Group will maintain the expansion of its international network and complete the shift of its services and product model towards an open architecture philosophy, allowing for an unrestricted choice of services and products for its clients.

GAM Holding will offer a broad range of equity and fixed income investment funds, discretionary portfolio management services and alternative investments. The board says that as a standalone entity, the business will be able to accelerate the development of its international institutional and US distribution franchise. The intention to proceed with the IPO of Artio Global in 2009 is confirmed, subject to market conditions.

The planned separation of the current Julius Baer Group into two independently listed corporate groups will conclude the gradual operational independence which has been afforded to the two business segments of private banking and asset management since the implementation of the pure financial holding company principle in 2007.

GAM will remain the preferred product provider for the private clients of Julius Baer Group, particularly for funds of hedge funds.

‘We are very pleased with our new strategic direction. In light of the challenges that many financial services business models are confronted with currently, we are convinced that both entities will benefit from their sharpened focus and the absence of competing interests, thus acting pro-actively in the best interest of all of our stakeholders’, says Raymond J. Baer, chairman of Julius Baer Holding (pictured).

The transaction will be subject to shareholder and regulatory approvals. An EGM is targeted for 30 June 2009.

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