Julius Bär Gruppe (BAER) Trading Update summary

Credit review and risk management

• Completed a comprehensive credit review, resulting in CHF 149 million in additional loan loss allowances for legacy real estate loans originated before 2023, now being managed down.

• Allowances align with the revised risk appetite and strategy shift announced in June, with a strengthened risk management team and framework.

• The affected loan book is about CHF 700 million, mainly income-producing residential and commercial real estate, with the total mortgage book at CHF 9 billion and overall LTV below 50%.

• Lombard and traditional residential mortgage portfolios confirmed as resilient and well-collateralised.

• Remaining income-producing and commercial real estate loans represent about a quarter of the mortgage book, including the CHF 700 million under review.

Operating performance and financials

• Achieved record assets under management of CHF 520 billion by October 2025, with net client inflows of CHF 12 billion and strong market performance.

• Gross margin stable at 83 basis points; underlying cost-to-income ratio improved to 66%, down five percentage points year-to-date.

• Efficiency program on track to deliver CHF 130 million in gross savings by year-end, exceeding the original target by CHF 20 million.

• CT1 capital ratio increased to 16.3% at end-October, up 210 basis points since the start of the year, and total capital ratio at 22.9%.

• Tier 1 leverage ratio remained at 4.9%, exceeding the 3.0% regulatory minimum.

Strategic and organizational updates

• Victoria McLean appointed as Chief Compliance Officer, joining the Executive Board in February 2026, pending regulatory approval.

• Revised compensation framework for relationship managers implemented, aligning incentives with bank and shareholder interests.

• New leadership in Switzerland and expansion with new offices in Lisbon and planned opening in Abu Dhabi, following Milan.

• Ongoing transformation and franchise investments are front-loaded, with major cost and payoff steps expected in 2026–2027.

• Consideration of moving to quarterly reporting is underway, with a decision pending.