Credit Suisse Group AG (SWX: CSGN) announced on Wednesday that Thomas Gottstein will be stepping down as Group Chief Executive Officer. The firm also said that it would launch a comprehensive strategic review, a mere nine months after the last one.
Gottstein was named Group CEO in February 2020. His tenure was a short and eventful one, mostly mired by devastating losses and scandal. The firm reported a staggering pretax loss of 1.2 billion francs (US$1.25 billion), with much of the weight coming from losses at the Investment Bank, but also impacted by heavier litigation expenses.
At the earnings call, Chairman Axel P. Lehmann thanked Gottstein for his dedication and commitment, as well for his leadership during the pandemic, as well, in his words, “in the aftermath of the two incidents in 2021.” But expressed that changes have to made to reposition the firm to regain its reputation and credibility.
“The need for change was clear before the second quarter results. But the disappointing performance has added a sense of urgency, as well, conviction for our actions,” Lehmann said. “With conviction, we are now embarking on measures to speed up our transformational course with a clear direction for the bank and a new leadership.”
Ulrich Körner will be the firm’s new Group CEO beginning August 1. Körner, like Lehmann, was recently employed by Credit Suisse rival UBS Group AG. Prior to joining UBS in 2009, he spent over a decade at Credit Suisse, rejoining in April of last year as CEO Asset Management.
Körner will be overseeing the comprehensive strategic review, and become the main driver of strategic and operational transformation.
One of the goals of the review will be to find ways to cut the firm’s absolute cost base to below 15.5 billion francs (US$16.3 billion) in the medium term.
The firm also announced the appointment of David Miller and Michael Ebert as Co-heads of the struggling Investment Bank. They will be overseeing Banking and Markets, respectively. CEO of Investment Bank Christian Meissner, “will focus on the ongoing strategic transformation of the business.”
Credit Suisse stock, which has been down by almost 42% in the last year, has been enjoying a slight upward trajectory since the announcement of the change in leadership. It last traded at 5.51 francs on the SWX.
Information for this briefing was found via Credit Suisse, Twitter, and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
