ZURICH, Aug 30 (Reuters) - Lender Julius Baer has decided to keep its Italian subsidiary Kairos after completing a strategic review and as the asset and wealth manager's performance improves, Switzerland's third-largest listed bank said on Friday.
Julius Baer had put Kairos under strategic review after it suffered outflows on the heels of poor fund performance in 2018. It said in July it was considering options including divesting the unit, forming a partnership or keeping it and trying to improve profitability.
"Our review has clearly shown that Julius Baer is the best owner for Kairos, which offers significant potential for us to build out our position in the attractive Italian wealth management market," European head Yves Robert-Charrue said in a statement.
"After a difficult 2018, the performance of Kairos funds in the first half of 2019 has markedly improved."
Italy's Mediobanca was considering acquiring Kairos.
Baer now intends to more closely align Kairos' wealth management business serving clients based in Italy with its own, including better access to the its products and services, the bank said.
"Over the coming months, these conclusions will be developed into a detailed implementation plan to realise the further growth potential of Kairos and additional revenue synergies," it said.
Kairos' assets under management had more than doubled to over 9 billion euros ($10.03 billion) since the start of the strategic partnership in June 2013, it noted. ($1 = 0.8973 euros) (Reporting by Brenna Hughes Neghaiwi; editing by Emelia Sithole-Matarise)