- POSTED: 21 Jul 2014 21:34
- UPDATED: 21 Jul 2014 21:43
Julius Baer said on Monday (July 21) it expects to strike a deal with US authorities over a probe into the Swiss bank's role in helping Americans evade taxes by the end of the year.
ZURICH: Julius Baer said on Monday (July 21) it expects to strike a deal with US authorities over a probe into the Swiss bank's role in helping Americans evade taxes by the end of the year.
Analysts predict the Zurich-based bank could face a fine of up to US$1 billion (740 million euros, S$1.24 billion) as part of a US clampdown on tax evaders, which saw Credit Suisse hit with a US$2.6-billion (S$3.23 billion) penalty in May.
Chief executive Boris Collardi said there was a "high" probability the bank would settle the case by the end of the year.
"We continue to believe that we will find a fair and equitable solution," Collardi told reporters after the bank announced better-than-expected first half results.
Authorities around the world have been clamping down on tax evasion in the wake of the global financial crisis. On Monday, the OECD said countries had identified an estimated 37 billion euros (S$62.1 billion) of hidden taxes through voluntary tax disclosure by more than half a million taxpayers.
Julius Baer also announced it would takeover the Luxembourg operations of Israeli lender Bank Leumi, which itself agreed to pay US authorities close to US$300 million (S$372 million) last month. Leumi Private Bank had 5.9 billion Swiss francs (4.9 billion euros, US$6.6 billion, S$8.12 billion) of assets under management at the end of June.
Julius Baer will also pay 10 million Swiss francs (S$13.8 milion) in cash as part of the deal, the bank said, adding that it expects to transfer over Leumi clients by the end of 2015.
Overall, Julius Baer's net profit in the first half of the year rose 56 per cent from the level a year earlier to 179 million Swiss francs (S$247 million). The results boosted Julius Baer shares by more than six per cent on the Swiss stock market, against a slightly negative trend.