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Julius Baer hit by $157mn loan loss in latest blow to turnaround efforts

Swiss lender’s chief risk officer Oliver Bartholet to ‘retire’ at the end of the year after series of scandals

Julius Baer has been hit with another large loan loss, worth SFr130mn ($157mn), and said its chief risk officer was “retiring” from the Swiss bank, dealing a fresh blow to the company’s turnaround efforts.

The Zurich-based lender and wealth manager disclosed on Tuesday that it had taken a loan loss charge related to its private debt business and “selected positions” in its mortgage book, which follows a SFr606mn writedown last year that triggered a leadership overhaul.

It added that Oliver Bartholet, who has served as the group’s chief risk officer since 2018, would “hand over his responsibilities” on July 1 and “retire” from the business at the end of the year.

It comes after the Financial Times revealed last week that Julius Baer had been ordered to pay more than SFr4mn by Switzerland’s financial regulator over anti-money laundering and compliance failings in its handling of high-risk clients.

The enforcement decision had not previously been made public by either the private bank or the Swiss Financial Market Supervisory Authority’s (Finma).

The SFr130mn charge marks the latest blow to scandal-hit Julius Baer, which is trying to execute a turnaround plan under its new leadership. Last year, the bank wrote down its full SFr606mn exposure to now-collapsed Austrian property group Signa and shut its private debt business.

The bank said it booked the latest charge after its new leadership undertook “an extended review of the remainder of the credit portfolio”.

It added: “After applying more prudent criteria with respect to credit quality . . . the loan loss allowances for selected positions in the mortgage book as well as the remaining private debt loan book were increased.”

Meanwhile, Bartholet’s departure is the latest executive leadership change at Julius Baer since former Goldman Sachs banker Stefan Bollinger took over as chief executive in January.

Bollinger has embarked on an aggressive cost-cutting drive, axing jobs, slimming down the executive board and refining the bank’s strategy. Former HSBC boss Noel Quinn also joined as chair earlier this month.

The bank said that Ivan Ivanic, its chief credit officer, who only joined from UBS in February, would replace Bartholet.

“As we are swiftly addressing legacy issues, we are also paving the way forward to unleash the full potential of our unique franchise and delivering on our stakeholders’ expectations,” Bollinger said in a statement.

The bank reported net new money inflows of SFr4.2bn during the first four months of the year “despite ongoing de-risking of the client book”.

Swedish buyout group looks to strike debt restructuring at one of two troubled French portfolio companies

Swedish private equity group EQT has offered to inject €220mn to help secure a restructuring deal at one of its two struggling French portfolio companies.

EQT, which bought the nursing home group Colisée in a 2020 buyout, made the proposal on Monday as part of a package that would see holders of a €1.2bn secured loan write off around 36 per cent of their debt in exchange for a 33 per cent stake in the business, according to people familiar with the discussions.

While no deal has been agreed, EQT’s offer to inject money has been positively received by lenders, one of the people said. A smaller credit line from banks would not be impaired, another person said.

Heavily indebted French companies have come under pressure in recent years, due to a moribund economy coupled with the removal of post-Covid support for businesses and rising interest rates on their borrowings.

If EQT succeeds in recapitalising Colisée, it would mark the latest in a string of debt restructurings in France, with Patrick Drahi’s Altice telecoms group striking a landmark €24bn deal with creditors of its French business earlier this year.

It would also help fix the balance sheet at one of two EQT portfolio companies in France to have come under pressure in debt markets in recent months.

Colisée’s debt slumped in value this year after it disclosed accounting discrepancies and growing liquidity pressures. The debt of medical laboratory group Cerba, which EQT bought in 2021, is also trading at distressed levels following worsening performance.

Cerba’s secured bonds are trading at 77 cents on the euro, while its unsecured debt is trading at about a fifth of face value, suggesting lenders are braced for heavy losses. Cerba reported slowing earnings earlier this month that meant its leverage on a debt to adjusted ebitda basis had risen to 8.6 times.

Colisée operates 400 sites across France, Belgium and southern Europe, making it the fourth largest operator in Europe. Moody’s downgraded its credit rating to Caa2 last month, which the rating agency defines as indicating “high credit risk”, noting there had been a “significant deviation from our expectations for earnings recovery and continued adequate liquidity”.

Moody’s added that a “couple of accounting discrepancies” had also “resulted in lower earnings”.

Colisée’s rival Orpea reached a debt restructuring agreement two years ago, after struggling under a high burden and facing scrutiny from a journalist’s investigation alleging systematic mistreatment at its care homes.

French grocer Casino is also coming under renewed pressure in debt markets, less than a year after it completed a restructuring in which more than €5bn of debt was wiped out and exchanged for equity.

EQT and Colisée declined to comment.

Deal to let Brits skip EU passport queues would have happened without post-Brexit accord

Broader reform of European border checks that has been planned for years would allow use of ‘e-gates’

A so-called breakthrough allowing Britons to use electronic passport gates across the EU — touted as a major victory this week by Sir Keir Starmer’s government — would have happened even without Monday’s historic post-Brexit agreement. 

A broader reform of European border checks that has been planned for years will allow non-EU nationals from around the world to use “e-gates” at airports across the bloc.

Monday’s agreement, which was heavily criticised by UK opposition parties, will streamline food exports to the EU but also cement access for European fishing fleets to British waters for a further 12 years.

As it sought to highlight “wins” from the deal, Downing Street played up the use of e-gates instead of physical passport checks.

“Instead of waiting in long queues at passport control, Brits travelling to Europe will now be able to use e-gates,” Number 10 said. “So you can start your holiday sooner.”

But rather than being a unique bilateral agreement, the changes will come as part of a broader reform of the EU’s border crossings under the so-called Entry/Exit System (EES), which will introduce electronic checks for all non-EU nationals.

It will still be up to individual countries to install the new systems, and they will have discretion over who can use them, officials cautioned.

Starmer said on Monday that the deal should enable easier travel for Britons but admitted that it was now up to European countries to “make this a reality without delay”.

Sir Ed Davey, leader of the Liberal Democrats, said: “While the prime minister boasts about a deal on e-gates, it sounds like the government is actually still just circling the runway.”

The EES will require non-EU nationals to register their biometric information, including photos and fingerprints, when they first enter the bloc. Airlines and airports have in the past warned that this process could lead to longer queues as the system is being rolled out.

The EES will then use this information to automatically analyse who has a right to enter the EU and for how long, making checks faster in the long run.

People who have the right to freely move in the EU, such as Britons who were living in the EU before the expiry of the post-Brexit period in 2020, will not be subject to the checks.

The European Commission said: “The introduction of the EES will open the possibility to use e-gates for all non-EU citizens, including UK citizens. This will contribute to fluidity at borders for both entry and exit.”

It pointed out that the specific use of electronic passport gates was up to the member states. “E-gates are managed by individual Member States, and there is no requirement for them to install or allow their use at all border points. Once the Entry/Exit System (EES) is in place, UK nationals will therefore be able to use e-gates where they are available, provided they are registered in the system.”

British officials have privately conceded that the EU-UK agreement simply clarifies that there will be no obstacles to Brits using e-gates under the bloc’s new electronic border checks.

The text states that “there will be no legal barriers to e-gate use for British Nationals travelling to and from European Union Member States after the introduction of the European Union Entry/Exit System.”

Assita Kanko, the MEP leading parliament negotiations on the new border checks, said the EES “always left the possibility of using self-service systems or e-gates . . . So there indeed was never a legal barrier”.

She added: “Now there is a stronger commitment from the EU and its member states to actually allow British nationals to access those e-gates.”

Anton Spisak, from the Centre for European Reform think-tank, said: “It’s important to remember that individual member states have discretion over how they manage their borders, and this deal doesn’t alter that.”

European lawmakers and representatives of the EU member states on Monday agreed on a phased start for the new system following a series of delays in its implementation, after Germany, the Netherlands and France had raised concerns about the computer systems.

The three countries still need to declare their readiness before the system can start. While an official rollout date has not yet been set, the commission on its website said “it is expected to start in October 2025”.

EU officials, meanwhile, downplayed the UK’s overenthusiastic messaging regarding the agreement.

“It’s good we’re getting closer. How this is then implemented in practice remains to be seen,” said one EU diplomat. Another added: “It’s a sign of a good deal when both sides are happy with the outcome.”

Letter asks regulator to protect American investors from opaque Chinese reporting policies

Top Republican financial officers from 21 states have urged the Securities and Exchange Commission to determine if Chinese companies on US stock exchanges should be delisted for failing to protect American investors.

The officers on Tuesday asked SEC chair Paul Atkins to investigate the companies because of Chinese policies that “create an environment of opaqueness that is antithetical” to the reporting requirements of US laws.

“China’s actions create an environment ripe for fraud and abuse, increasing the likelihood that China-based US-listed companies will violate the disclosure, auditing or anti-fraud provisions of the Securities Exchange Act,” the officers from states including Pennsylvania, South Carolina and Arizona said in the letter obtained by the Financial Times.

The letter marks the latest move in the US by groups and lawmakers who argue that American money should not be used to help Chinese companies, particularly any with links to the Chinese military.

The officers said the SEC had the authority to delist firms that did not comply with the Securities Exchange Act or relied on auditors in countries where the US Public Company Accounting Oversight Board could not carry out effective inspections. 

They noted, for example, that the Chinese Communist party had cracked down on the ability of foreign firms to conduct due diligence on Chinese companies and allowed the use of opaque structures known as variable interest entity arrangements to help “circumvent US regulatory scrutiny”.

The officers said those concerns, coupled with the PCAOB having found “pervasive deficiencies” in inspections of Chinese auditors, “necessitate a close examination of whether China-based companies should be listed on US exchanges”.

The letter comes two weeks after two senior Republican lawmakers urged the SEC to delist Chinese companies, including Alibaba, that they said had military links that hurt US security.

John Moolenaar, chair of the House China committee, and Rick Scott, chair of the Senate ageing committee, urged Atkins to take action. Moolenaar told the FT on Monday that he had since spoken to the SEC chair about the issue.

“We had a productive discussion about the urgent need to address the risks posed by CCP-linked companies in our capital markets,” said Moolenaar. “I look forward to continuing these conversations and working together to strengthen enforcement, protect American investors and ensure our markets are not used to fund the Chinese Communist party’s military and surveillance ambitions.”

OJ Oleka, chief executive of the State Financial Officers Foundation, said his members sent the letter now because President Donald Trump was “a president who is willing to be tough on China and the CCP and put America first”.

“It takes heavy suspension of disbelief to accept that China-based companies are doing their best to comply and be fully transparent with American regulators,” Oleka added.

The SEC declined to comment. Asked about the Moolenaar and Scott letter, Atkins on Monday told reporters the SEC was “still digging in” and was “trying to figure out about this issue”, noting it was his 20th day in the job.

The letter from the financial officers will increase pressure on Atkins to announce policy measures focused on China. His predecessor, Gary Gensler, raised scrutiny of Beijing’s involvement in the US securities market and pushed for inspections of auditors of Chinese groups listed in the US.

The PCAOB has sent teams to inspect Chinese audit firms annually since a deal with Beijing in 2022 that was agreed after Congress passed a law to delist companies whose auditors were not subject to US oversight.

PCAOB chair Erica Williams this month told the FT that the regulator continued to test “every aspect of that very prescriptive agreement” to ensure it can investigate and inspect completely. “Thus far we have been able to,” she said.

But she warned that the agreement between the PCAOB, the China Securities Regulatory Commission and China’s finance ministry would lapse if the oversight board was abolished.

A Republican proposal to close the agency and absorb its functions into the SEC is included in Trump’s tax bill, which is making its way through Congress.

Global tour by CEO highlights how leaders from U.S. to China covet his chips

Key Points

TAIPEI—The American president called him “my friend,” Saudi Arabia bought hundreds of thousands of his chips and, in the land of his birth, he was hailed as “the leader of team Taiwan.”

With a visit to Taipei this week, Nvidia Chief Executive Jensen Huang capped a whirlwind month of travel that marked him as not just a business tycoon, but one of the world’s most powerful geopolitical forces.

Everyone wants a piece of the charismatic CEO and his coveted chips, seen as the gold standard for advanced artificial-intelligence computing. Investors celebrated his global coming-out party by pushing Nvidia shares up 40% over the past month. The stock’s swoon in January is a distant memory and the company, with a market capitalization of $3.3 trillion, is again within striking distance of global No. 1.

But international fame carries risks too—Huang does business in sensitive regions such as China and the Persian Gulf states.

“His fortune and misfortune is that he created the most valuable technological input of the decade,” said Barath Harithas, a senior fellow at Washington-based think tank Center for Strategic and International Studies. “The danger is that his visibility becomes a liability. He could end up the fall guy if things unravel in the Gulf, and then face political heat for any perceived overreach in China.”

Huang’s processors and investment spending have the power to change countries’ fates, and the 62-year-old billionaire has himself been changed by his power. He has donned a business suit and tie for meetings with world leaders, shedding his customary leather jacket, and added praise for politicians to his salesman’s patter about tokens and terabytes.

“Without the president’s leadership, his policies, his support and, very importantly, his strong encouragement,” Huang said while standing beside President Trump at the White House on April 30, “frankly, manufacturing in the United States wouldn’t have accelerated to this pace.”

Trump returned the favor two weeks later by giving a shout out to the CEO in a speech in Saudi Arabia. “I see my friend is here, Jensen, that’s very good,” Trump said. “He’s putting in $500 billion,” the president went on, referring to Nvidia’s commitment to build AI supercomputers in the U.S.

Since mid-April, Huang has been flying across the world, unveiling new investments and striking deals. In the Middle East last week, Huang met Saudi Arabia’s crown prince and agreed to sell Nvidia’s powerful AI processors to the United Arab Emirates, Saudi Arabia and Qatar.

In Taiwan this week, the location of Nvidia’s most important suppliers, Huang drew loud cheers and praise from the island’s president when he announced on Monday the construction of a new Nvidia office building and plans for Taiwan’s first AI supercomputer.

Crowds and rock star-like excitement followed his every step. Huang, a U.S. citizen, was born on the island before moving to the U.S. as a child.

When Huang was due to turn up at an Nvidia partner’s booth at an industry conference on Tuesday, hordes of fans started to gather at the venue as early as an hour ahead. As he walked toward the booth, fans began pressing against the barricades, calling out “Jensen, I love you!” and reaching out to touch the executive.

In a speech, Young Liu, chairman of Taiwan-based contract manufacturer Foxconn, called Huang “the leader of team Taiwan” for his efforts to build up Taiwan’s AI industry.

In return, Huang called Taiwan the “epicenter of the world’s computing industry.”

Huang has pulled off the feat of staying friends with both the U.S. and China, despite tensions between the two superpowers.

In early April, he attended a $1 million-a-head dinner with Trump at Mar-a-Lago, and afterward some inside Nvidia were confident the company could keep selling its H20 chips in China, which had been tailored to comply with earlier U.S. regulations. Instead, the U.S. said a few days later it would restrict the sale of the H20 chips, which led Nvidia to take a $5.5 billion charge in the first quarter.

Within days of the new rule, Huang flew to Beijing and publicly reassured senior Chinese officials the company would “unwaveringly serve” the market there. Later, he met the mayor of Shanghai and left with the city’s blessing to open a new research and development center there.

Huang has repeatedly said China will be a powerhouse in global AI development and it would be folly for Nvidia to neglect the market. Each time new U.S. export controls on advanced semiconductors have been introduced, Nvidia has adapted by downgrading its chips’ specs to continue selling to Chinese customers.

Lian Jye Su, an analyst at Omdia covering AI, said Nvidia was trying to avoid picking sides between the U.S. and China.

“Nvidia doesn’t have the luxury of staying neutral, and can only try its best to minimize the political fallout,” Su added.

Last week, the Commerce Department put out guidance against the use of American AI chips to train Chinese models and warned against the diversion of such silicon to China.

Harithas of CSIS said the perception of an American executive courting China ran against sentiment in Washington. “If he leans too far toward China with even a neutered chip variant, he risks crossing a red line, triggering public rebuke, or worse, legal blowback,” he said.

The fair will run in February 2026 and cements the Middle East as the next frontier in the global art market

Art Basel will launch a new art fair in Doha, Qatar next year, a move that cements the Middle East as the next frontier in the global art market. “The Middle East and north Africa region is an incredibly important part of the world that in art market terms is relatively underserved,” says Noah Horowitz, chief executive of Art Basel. He says the new fair, to be known as Art Basel Qatar, will be “a breath of fresh air” in “a period of [art market] recalibration”.

The latest Art Basel & UBS Art Market report found that global art sales fell 12 per cent to $57.5bn in 2024, with the Middle East accounting for less than 1 per cent of total turnover. In February, Sotheby’s hosted its first auction in the region, in Saudi Arabia, which made a total $17.3mn (including fees). Internationally focused fairs currently run in Dubai and Abu Dhabi but Art Basel is the first big-brand name to commit to the scene.

Art Basel Qatar will run in February 2026 and is a three-way partnership between Art Basel’s parent company, MCH Group, with QC+, the commercial arm of Qatar Museums, and Qatar Sports Investments, whose holdings include the French football team Paris Saint-Germain. It is the first time that Art Basel has struck what Horowitz describes as a “multi-dimensional partnership” for one of its fairs, though the financial terms of the collaboration have not been revealed. Art Basel Qatar will be in Doha’s M7, a high-spec cultural hub in the Msheireb district. The fair’s first edition will be small, with about 50 exhibitors, Horowitz says — about a quarter of the size of the smallest fair it currently runs, in Paris. “We are building long-term and gradually.”

Behind it all is Sheikha al-Mayassa bint Hamad bin Khalifa al-Thani, chair of Qatar Museums and sister of the ruling emir of Qatar. She describes herself as a “cultural partner” to Art Basel Qatar and tells the FT that “this isn’t the first time that an art fair has come to us, but I didn’t feel the time was right until now.” She explains: “We have spent 20 years investing in the software, by which I mean human development, and the hardware, that is building museums. Now we can take our talent, our creatives in the Arab world, to the industry. And Art Basel is the most important platform in the world.” Sheikha Mayassa is also behind Qatar’s first and permanent national pavilion for the Venice Biennale, designed by the Lebanese-born architect Lina Ghotmeh.

Concerns remain over Qatar’s human rights record, notably its treatment of migrant workers, which Amnesty International found were not properly remedied during the 2022 football World Cup, and women, girls and the LGBT+ community. Under the guardianship system, women still need permission to marry and access reproductive healthcare, among other restrictions, while individuals have been detained for their sexual orientation or gender expression. Horowitz says that “there is a very stringent MCH code of conduct that we stand behind and will apply locally, we are absolutely committed to that.”

Art Basel is one of the oldest art fairs on the circuit, founded by three Swiss art dealers in 1970, which now runs events in Miami, Hong Kong and Paris as well as its founding city. Since 2020, its anchor shareholder has been Lupa Systems — the investment vehicle run by James Murdoch — which owns a 42 per cent stake in MCH Group, while the Canton of Basel-Stadt has a 37.5 per cent holding. 

It is a time of shake-up among the biggest-brand commercial art events. Earlier this month, the Hollywood powerbroker Ari Emanuel revealed that he is buying the Frieze global art fair and publishing group from Endeavor, the entertainment group he co-founded, in a deal valued at nearly $200mn.

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