New head honcho at Julius Baer

Julius Baer has promoted its current chief operating officer Boris Collardi to the position of chief executive officer to replace Johannes A de Gier. The appointment is effective May 1, 2009.

Collardi is relatively new to the Swiss private bank, having joined as COO in early 2006 following Julius Baer's acquisition of three private banks and hedge fund GAM Holding at the end of 2005. Collardi was involved in the integration of these banks into Julius Baer.

de Gier was appointed CEO in December last year after his predecessor, Alex Widmer, committed suicide. He will continue in his role as chairman of GAM.

Collardi's career includes 12 years at Credit Suisse in Europe and Asia, where he has held positions including global chief financial officer and chief operating officer for Europe, the Middle East and Africa.

"In the current market environment, continuity enjoys a high priority and calls for a clear skill set," Raymond Baer, chairman of the Julius Baer board, said in a written comment on Collardi's appointment. "As an experienced manager deeply rooted in private banking, Boris Collardi complements these skills with a multi-cultural and international background."

Julius Baer was founded in 1890 and has grown into one of the leading dedicated wealth management firms in Switzerland. At the end of 2008, the firm's total client assets amounted to SFr338 billion ($296 billion) with assets under management accounting for SFr275 billion.

Collardi takes the helm at the Swiss bank at a challenging time for private banking. A recent landmark settlement by UBS in the US saw the rival Swiss firm agree to pay $780 million in fines, identify certain US clients and put an end to tax shelters. The settlement came after accusations that UBS had helped Americans evade taxes.

But the ramifications go beyond US borders. Banking secrecy legislation, which the Swiss enacted back in 1934, is now under fire. Under mounting pressure, Switzerland agreed on March 13 to adopt the Organisation for Economic Cooperation and Development's standard on the exchange of information with other countries in cases where individuals are suspected of tax evasion in their home countries. The Swiss Federal Council said in a statement that "Swiss banking secrecy remains intact" but the fact remains that in the past Switzerland did not share such information. The group of 20 nations which meet in London this week are expected to discuss tax avoidance and tax evasion and further changes could follow.

"Clients were attracted to Swiss banks because they felt their privacy would always be protected, especially in cases where tax regimes in their home countries were onerous," says a specialist. "Once that advantage is gone, it's a more level playing field between private banks, irrespective of where they are headquartered."