Swiss wealth supervisor Julius Baer is about to evaluation its non-public debt enterprise amid ongoing losses ensuing from its publicity to Austrian property group Signa.
Julius Baer’s share worth fell by 16 per cent final week after it revealed that it was taking a €73m (£63.4m) provision in opposition to losses in its credit score portfolio stemming from difficulties at Signa.
Signa’s €27bn property portfolio was hit exhausting by rising rates of interest, and the agency is alleged to be near insolvency.
Julius Baer’s chief government Philipp Rickenbacher admitted final week that Signa represents the one largest publicity within the wealth supervisor’s €628m non-public mortgage guide.
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“We remorse {that a} single publicity has led to the current uncertainty for our stakeholders,” Rickenbacher mentioned. He added that because of this, “we’ll evaluation our non-public debt enterprise and the framework by which it’s performed”.
Signa’s property embody a stake in KaDeWe, Germany’s most well-known division retailer, and the Chrysler Constructing in New York.
Earlier this month, the property group appointed a brand new chair to restructure the group, changing the corporate’s founder René Benko.
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Signa is believed to owe roughly €13bn to banks and traders, in accordance with an evaluation by JPMorgan.
Vontobel analyst Andreas Venditti mentioned whereas Julius Baer’s general capital place was sturdy, there have been nonetheless questions on its Signa publicity.
“The important thing query stays extremely unsure,” Venditti mentioned. “What collateral does Julius Baer maintain and the way a lot is it nonetheless price?”
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