The acquisition makes Julius Baer Switzerland's biggest wealth manager focused purely on private banking and asset management. The new group will have approximately CHF270 billion of client assets.

Three small private banks make up the SBC Wealth Management group, including Geneva-based Ferrier Lullin & Cie, Zurich-based Ehinger & Armand von Ernst and Lugano-based Banca di Lugano, in addition to fund manager, GAM. Julius Baer plans to fund most of the acquisition by a share issue, with UBS taking a 21.5 per-cent stake in the enlarged group.

According to Julius Baer, clients and employees will benefit from new opportunities as a result of strengthened local franchises, a substantially broadened product range and the combination of different cultural backgrounds and professional experiences. The enlarged firm aims to generate significant net revenue benefits and cost savings in excess of CHF150 million pre-tax per annum by 2008.

"By combining our geographically broad client-centric private banking franchise with outstanding investment skills, we expect to create a very attractive wealth manager," noted CEO Johannes A. de Gier.

"Our combined resources allow for best-in-class capabilities, and our commitment to continuous training and education ensures that our private bankers will deliver best advice to meet each client's specific needs. Clearly, this makes us a highly attractive employer for wealth management talents," he added.