Julius Baer shares slump as money inflows show little gain from Credit Suisse woes

ZURICH, May 23 (Reuters) - Julius Baer (BAER.S) reported modest money inflows in the first four months of this year, disappointing investors who had expected the Swiss wealth manager to benefit from Credit Suisse's troubles and sending its shares down as much as 8%.

The bank, which competes with both Credit Suisse (CSGN.S) and UBS (UBSG.S) in managing the investments of the wealthy and ultra-wealthy, is still tipped to attract more business as a result of turmoil that led to Credit Suisse's takeover in March by bigger rival UBS.

However, in its trading update, Julius Baer said that even as inflows picked up after a slow start to the year, they totalled 3.5 billion Swiss francs ($3.94 billion) over January-April, with assets under management inching up just 1% to 429 billion francs.

The numbers came below expectations, with some analysts forecasting inflows twice as high, even as some had cautioned it might take more time for Julius Baer to attract funds leaving Credit Suisse.

"All in all, we view the net inflows as disappointing given the turbulence at Credit Suisse was already significant in the fourth quarter," ZKB analyst Michael Klien said in a note.

RBC analysts said they had anticipated net inflows, adjusted for the effect of clients' reducing risk and borrowing, of 6 billion Swiss francs in the first four months of this year, following strong momentum in the final two months of last year.

Reporting its 2022 results in February, several weeks before UBS agreed to take over Credit Suisse as part of a Swiss government-orchestrated rescue, Julius Baer said Credit Suisse's troubles contributed to inflows of new funds, particularly late in the year.

It made no reference to its Swiss rivals in its January-April update, but said by hiring more relationship managers it was well placed to attract more funds later in the year.

"Looking ahead, actual and forthcoming significant growth in the Group’s RM (relationship manager) base is expected to meaningfully benefit the generation of net new money over the medium term," Julius Baer said.

UBS has been racing to seal the Credit Suisse deal, aiming for its legal close within coming weeks, as it is keen to limit customer and staff departures following the months of turmoil at its smaller rival.