ZURICH, Dec 18 Reuters Julius Baer39;s exposure to toppled property group Signa could result in losses that far exceed the provisions taken by the Swiss wealth manager, an analyst said on Monday.

We have increased our expectation for credit losses to 400 million Swiss francs 460.7 million on the mentioned exposure, Zuercher Kantonalbank analyst Michael Klien wrote in a note to clients.

Klien, who previously estimated the loss at 300 million francs, said the increased figure reflects that private debt often has no direct recourse to real assets.

Julius Baer last month said it had exposure of 606 million Swiss francs the largest in its private debt loan book to a European conglomerate and that it had booked 70 million francs in loan provisions against its credit portfolio after Oct. 31.

The bank39;s share price has lost about 15 in the past month on fears over its ties to property and retail group Signa, which is controlled by Austrian magnate Rene Benko and recently declared insolvency.

Klien said that, after a meeting with Julius Baer finance chief Evie Kostakis, he believes the exposure is likely to remain isolated.

Although there are still various risks FINMA investigation, possible reputational damage, changes in management, we believe that these are already more than reflected in the current valuation, Klien wrote.

Julius Baer declined to comment.

1 0.8682 Swiss francs

Reporting by Noele Illien Editing by David Goodman

Source Reuters