Julius Baer’s $30 Million Pay Package Shows the Price of a Banking Reset

<p>Julius Baer just handed its new chief executive one of the biggest pay packages in European banking. On paper Stefan Bollinger earned nearly CHF24 million ($30.5 million) in 2025, more than UBS boss Sergio Ermotti.</p>
<p>But the headline number says less about performance than it does about the price Julius Baer is willing to pay to restore credibility after its disastrous exposure to René Benko’s collapsed Signa property empire.</p>
<p>WHAT HAPPENED</p>
<p>Julius Baer said chief executive Stefan Bollinger received total compensation of CHF23.96 million for 2025, his first year leading the Zurich-based private bank.</p>
<p>The figure immediately stood out in Swiss finance. UBS chief executive Sergio Ermotti earned CHF14.9 million for the same year, while Novartis chief executive Vasant Narasimhan received CHF24.9 million.</p>
<p>But the Julius Baer package requires context. Bollinger’s pay for his work during the year totaled CHF8.27 million. The rest came from replacement awards worth CHF14.76 million that compensated him for deferred bonuses he forfeited when leaving Goldman Sachs to take the job.</p>
<p>In other words, most of the payout was a recruitment cost rather than a reward for his first year’s performance.</p>
<p>Bollinger took over the bank in January 2025 after the departure of former chief executive Philipp Rickenbacher. His predecessor stepped down following the fallout from Julius Baer’s heavy lending exposure to the Signa property group controlled by Austrian investor René Benko.</p>
<p>The collapse of Signa forced Julius Baer to take large write-downs and triggered serious questions about its risk management culture. The episode damaged the reputation of a bank long known for conservative private banking and disciplined wealth management.</p>
<p>The institution has spent the past year trying to reset its strategy. Julius Baer says it is refocusing on its core wealth management business and stepping back from riskier activities that complicated its balance sheet.</p>
<p>Operationally, the bank reported a mixed picture for 2025. Assets under management rose 5% to CHF521 billion and the group attracted CHF14.4 billion in net new money during the year. Underlying profit before tax rose 17% to CHF1.266 billion and efficiency improved.</p>
<p>But reported net profit fell 25% to CHF764 million, reflecting one-off charges and CHF213 million in credit losses linked partly to the Signa clean up.</p>
<p>The bank also remains under an enforcement proceeding by Swiss regulator Finma related to earlier risk management failures. Until that process is resolved Julius Baer cannot resume share buybacks, limiting its ability to return capital to shareholders.</p>
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<p>The pay package highlights a broader truth about corporate turnarounds. Fixing a damaged franchise rarely comes cheap.</p>
<p>Boards almost always promise the same solution when things go wrong. They hire new leadership, tighten risk controls and declare a fresh strategic start. But recruiting the person meant to symbolize discipline and credibility often requires a very expensive offer.</p>
<p>That is particularly true when the candidate is coming from a global investment bank like Goldman Sachs. Executives at that level often leave behind years of deferred compensation, which new employers must replace if they want the hire to happen.</p>
<p>Technically that makes Bollinger’s compensation look less dramatic. Much of the money simply replaces incentives he had already earned elsewhere. Yet the distinction rarely changes the public reaction.</p>
<p>Investors and employees do not read compensation tables the way accountants do. They see a headline figure and judge the message it sends.</p>
<p>In this case the message is complicated. Julius Baer is trying to project caution and discipline after a damaging risk management episode. At the same time it is paying its new chief more than the leader of Switzerland’s largest bank.</p>
<p>That tension reflects the deeper challenge facing the group. Julius Baer must convince clients and investors that the Signa episode was an isolated mistake rather than a structural weakness in how the bank evaluates risk.</p>
<p>Bollinger’s mandate is therefore about more than financial performance. He must restore trust in the institution’s culture and decision making.</p>
<p>There is also a broader Swiss context. Executive pay remains politically sensitive in the country, particularly in banking. UBS is still under intense scrutiny following its takeover of Credit Suisse and the regulatory debate that followed.</p>
<p>Against that backdrop a near CHF24 million pay package was always likely to attract attention, even if much of it is a one time recruitment cost.</p>
<p>WHAT’S NEXT</p>
<p>The real test for Bollinger will not be his compensation but whether the strategy works.</p>
<p>Investors will watch closely to see if Julius Baer can deliver stronger profitability in 2026 while avoiding new surprises from legacy exposures. Progress with regulators will also matter because the bank cannot restart share buybacks until the Finma enforcement process is resolved.</p>
<p>If the reset succeeds, Bollinger’s recruitment package will look like an expensive but rational investment in leadership. If it fails, the pay figure will become an easy symbol of a bank that paid heavily for change but struggled to deliver it.</p>
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