Julius Baer greatly enhances risk control and compliance

The changes introduced by Julius Baer include:

• The Group has adapted its strategy under its new leadership. In future, its focus will shift from new money growth to sustainable profit growth.
• Region Latin America has been under new leadership since December 2017, and new appointments have been made to all key positions. The region’s strategy has been completely overhauled, including the introduction of a market-specific focus that has resulted, among other things, in the closure of the local business in Panama and Venezuela.
• The Group undertook a comprehensive programme over the last two years to strengthen its global risk management, and made new appointments to key and leadership positions. This programme addressed many of the weaknesses identified by FINMA. Further investments and measures are being implemented with high priority.
  The documentation standards for client data and active client relationships have already been further developed and improved. Both the front office and the control units were extensively involved in this project (‘Atlas’), which was completed on schedule in late 2019, to ensure that the associated cultural transformation would be embedded in the organisation with lasting effect. The effectiveness of the compliance function has been significantly improved thanks to substantial investment in staff – with headcount up by some 40 per cent in recent years – as well as in processes, technology and data analysis. In addition, considerable sums have been and continue to be invested in enhancing transaction monitoring and combating money laundering. The Group will also adapt its incentive and compensation systems to correspond with its risk standards.

Romeo Lacher, Chairman of the Board of Directors of Julius Baer Group, said: “We accept FINMA’s findings and regret the shortcomings identified in our business with Latin American clients. This is not compatible with the risk culture that we are striving to achieve. Julius Baer has invested substantially over the past few years in strengthening our compliance and risk management processes to make them fit for the challenges of the future and, as part of our new strategy, we will continue to invest forcefully in these areas. We are fully confident that the measures we have taken have already had a positive lasting impact. Together with the Executive Board, the Board of Directors will rapidly and resolutely enforce implementation of the measures initiated and decreed by FINMA