It is now up to these four bankers

Das Axel Lehmann had imagined very differently when he was appointed Chairman of the Board of Directors at the beginning of 2022 CreditSuisse (CS) was chosen. The 64-year-old Swiss should finally bring calm back to the crisis-ridden bank, whose management had caused bankruptcies, bad luck and breakdowns for years, but was still handsomely rewarded. The doctor of business administration succeeded António Horta-Osório. The self-important Portuguese had allowed himself to flout the corona protection rules and jetted happily around the world during the pandemic. That was another damage to the image of the scandal-plagued bank.

The somewhat fussy, conservative, but respected and respectable Lehmann seemed to be the right person to ground Credit Suisse. He’s anything but a gambler. He had completed a large part of his career on the board of the insurance group Zurich; moreover he held leading positions for the big local rivals UBS worked. Despite these experiences, Lehmann, as Chairman of the Board of Directors, was unable to turn the rudder sharply enough to get the lurching CS back on course.

At the beginning of August, he changed the chairman of the board: the German Ulrich Körner took the place of the Swiss Thomas Gottstein, who only served for a short time. He also looks back on a career at UBS, but to his own chagrin he never quite made it to the top. The native of Friborg has now made this leap at Credit Suisse. There, the down-to-earth, often grumpy-looking numbers man was particularly noticeable because of his poor communication skills. But different from his predecessor, who was hunted down by the court because of a spy affair Tidjane Thiam he knows the banking business inside out. On top of that, the former management consultant is experienced in restructuring and has the power to make decisions.

The expectations of the conversion plan that Körner presented together with Lehmann at the end of October and which he wanted to put into practice by 2025 were all the greater. The plan was to slash costs, tie back the loss-making investment bank, and thus reduce risk. At the same time, asset management should be strengthened.

But of all things in the prime discipline of asset management, in which the CS one of the leading banks in the world, the bank increasingly lost the trust of its customers. After rumors on social media that Credit Suisse was in danger, the bank lost 111 billion francs in customer funds in the fourth quarter of 2022. It closed the year as a whole with a loss of CHF 7.3 billion.

While Körner remained passive in terms of communication despite the whole misery, Lehmann dared to come out of cover at the beginning of December. But he acted naively and clumsily: in a television interview he said that the outflow of funds had “essentially stopped”. But two months later it turned out that billions of francs in customer funds had left the bank in December. As a result, Lehmann was targeted by the Swiss Financial Market Authority (Finma) for “possible violations of financial market law”. Ultimately, the latter refrained from opening a supervisory procedure. Nevertheless, another shadow fell over the bank through his own fault.

Lehmann and Körner had set themselves the goal of securing the future of Credit Suisse as an independent bank. Under no circumstances did they want to slip under the umbrella of a competitor, certainly not under that of arch-rival UBS. But now everything looks like that’s exactly what’s happening: the Swiss industry leader UBS is negotiating a takeover of CS – albeit not entirely voluntarily.

UBS CEO Colm Kelleher, who has been in office since April 2022, has indicated several times that he is not seeking the salvation of his bank by working side by side with Credit Suisse. As the market leader in asset management, he sees good opportunities to further advance his own business organically, especially in Asia and America. Under pressure from the Swiss central bank, Finma and the government, he nevertheless agreed to takeover negotiations. The President of the Swiss National Bank, Thomas JordanFinma director Urban Angehrn and the representatives of the federal government, above all the Swiss finance minister Karin Keller-Sutter (FDP), wrap up warm.

Kelleher, 65, is a seasoned Wall Street veteran. After a period as an auditor with Arthur Andersen, the Irish-born worked for Morgan Stanley for three decades. At this American investment and wealth management bank, he rose to number 2. In his position as Chief Financial Officer at the time, Kelleher steered Morgan Stanley through the financial crisis with great skill between 2007 and 2009. Kelleher will do everything in his power to only take over CS under conditions that protect UBS from possible financial and legal risks of a takeover as far as possible.

If the forced marriage does take place, Ralph Hamers will have to take the lead in putting the various pieces together. Then the 56-year-old Dutchman, who has been on the UBS board since November 2020, unexpectedly faces a new Herculean task. The former head of ING-Bank had so far mainly tried to digitize the business and processes of UBS and to dismantle inhibiting hierarchies.

The new task will be many times larger. It seems clear that Hamers and Kelleher will lead the whole new entity. Anyone who pays announces, no matter how low the price.