GAM’s Assets Fall By Half

Feb 9 2009 | 1:09am ET

Swiss private bank Julius Baer posted a profit last year, no thanks to its hedge fund business.

The firm’s GAM unit saw its assets under management fall by more than half in 2008. GAM managed US$39.2 million at the end of last year, compared to US$75.8 million at the beginning of the year.

In its year-end report, Julius Baer blamed the outflow on “heightened risk aversion among investors” in the wake of the Bernard Madoff scandal. But it added that the Madoff fallout could prove a positive for it, because it “ultimately should eliminate a large number of competitors offering lower quality, lower cost service.”

Julius Baer’s profit fell 30% last year to 661 million francs (US$569.5 million).

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