Credit Suisse Chief Executive Tidjane Thiam has quit after a power struggle at Switzerland’s second-biggest bank, which faces investor pressure over a spying scandal being investigated by Swiss regulators.
The Zurich-based bank said on Friday that Thiam would be replaced by Thomas Gottstein, who is head of its Swiss business.
The spying scandal had exacerbated tensions between Thiam and Chairman Urs Rohner, people close to the bank have said. Although several major shareholders pledged their support for Thiam this week, he struggled to win the backing of the board.
Credit Suisse’s board said on Friday that Rohner had its backing to complete his term until April 2021.
Thiam was appointed as CEO in 2015, having never previously worked for a bank. At Credit Suisse, the ex-Prudential boss focused on cutting costs, reducing risk, scaling back investment banking to focus more on wealth management, and strengthening its balance sheet.
Engineering that turnaround led to three years of consecutive losses, but the bank returned to profit in 2018, leading to plaudits for the former Ivory Coast government minister and McKinsey management consultant.
Credit Suisse has been trapped in a crisis since September, when its former star wealth manager Iqbal Khan, after switching to rival UBS, confronted a private detective following him and his wife through Zurich.
What the bank initially described as a rogue spying case run by then-Chief Operating Officer Pierre-Olivier Bouee widened as details emerged of additional instances of surveillance.
Swiss financial supervisor FINMA is conducting its own investigation after the bank subsequently acknowledged that it had tailed former human resources head Peter Goerke.
Thiam’s departure does not draw a line under the affair.
FINMA is examining the board’s oversight of Thiam and his top lieutenants and whether management control failures led to Credit Suisse snooping on its former executives.
Thiam again said he knew nothing about the surveillance.
“I had no knowledge of the observation of two former colleagues,” Thiam said in the Credit Suisse statement.
“It undoubtedly disturbed Credit Suisse and caused anxiety and hurt. I regret that this happened and it should never have taken place.”
Credit Suisse shares were down 4.5% by 0810 GMT.
Gottstein, a prominent investment banker and wealth manager before taking over Credit Suisse’s domestic operation, had been mooted by analysts as a potential successor to Thiam.
Gottstein, the first Swiss citizen after a series of foreigners to be appointed CEO, has been at the bank since 1999, joining from UBS. He has spent most of his career working in equity capital markets before taking over as chief of Credit Suisse’s Swiss bank in 2015.
“Based on his deep and comprehensive experience in our business and in view of his impressive performance as head of our Swiss bank and his respect amongst our clients and employees, Thomas Gottstein is excellently positioned to lead Credit Suisse into the future,” Rohner said in a statement.
Thiam’s resignation, effective from Feb. 14 after the presentation of fourth-quarter and full-year 2019 results, came at a board meeting on Thursday.
During the meeting in Zurich directors backed Rohner despite calls from Swiss investment adviser Ethos Foundation for him to quit.
“Urs Rohner has led the board of directors commendably during this turbulent time,” said board member Severin Schwan in the bank’s statement.
“After careful deliberations, the board has been unanimous in its actions, as well as in reaffirming its full support for the chairman to complete his term until April 2021.”
In Switzerland, Credit Suisse and UBS typically have a Swiss national as either chairman or chief executive.
Gottstein’s appointment could therefore pave the way for a non-Swiss chairman. One person familiar with the matter said Richard Meddings, a British banker set to join the board, could take over from Rohner.
Andre Helfenstein, now responsible for Credit Suisse’s institutional clients in Switzerland, will succeed Gottstein as CEO of the Swiss business and join the executive board.
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