At the same time, Credit Suisse’s stock has languished under Horta-Osório and his leadership style has grated with some. In one example from the summer of 2021, he told a meeting of bankers that the firm had a great wealth management business “with ancillary services,” according to several people who heard the remarks. For several top dealmakers and traders, those words were perceived as a blow given the investment bank delivered more revenue than any other division at the firm.
In turning to Lehmann, the bank is appointing a Swiss insider who spent almost two decades at Zurich Insurance Group AG and is well versed in risk management as Credit Suisse seeks to shore up its defences after the $5 billion hit from Archegos. He was elected to the bank’s board in October, having formerly served as Chief Operating Officer at UBS Group AG and head of the bank’s Swiss division. Like Horta-Osório, he has retail and corporate banking experience while having had less exposure to investment banking.
Horta-Osório’s six-month strategy review resulted in a simplified structure and the bank’s exit from the hedge fund business, though stopped short of the radical changes that characterized Deutsche Bank AG’s overhaul three years earlier. Credit Suisse’s stock has trailed global peers since the overhaul plan was announced in November. Speculation about possible M&A has ensued.
“The ongoing turnover with management changes brings further uncertainty,” JPMorgan Chase & Co. analysts led by Kian Abouhossein wrote in a note to clients. Speculation about a merger “is not credible in our view, with the change in chairman unlikely to be a trigger for this either; for now we see Credit Suisse continuing as a standalone entity.”
The appointment of Lehmann raises questions about whether he and Gottstein will continue with the strategy set out late last year or whether they will seek to undertake any further change of course, including further cuts to the investment bank. During his short time in charge, Horta-Osório also made several high-level executive appointments and Lehmann could also move to bring in his own people.
In a statement, Lehmann said the bank had “set the right course” with its strategic review and that he would continue to work on strengthening the risk culture across the bank.
Horta-Osório’s departure came less than a day after an Australian court upheld a government decision to revoke Novak Djokovic’s visa after the tennis star sought to bypass an entry requirement in one of the world’s most vaccinated countries. In the U.K., Prime Minister Boris Johnson’s future is in balance after a public backlash over rule-breaking parties at his Downing Street office.
--With assistance from Marion Halftermeyer.
This article was provided by Bloomberg News.