Credit Suisse axes boss Tidjane Thiam after spying scandal

Tidjane Thiam was ousted on Friday as chief executive of Credit Suisse after an extraordinary power struggle with his chairman and despite the public support of leading investors.

The former Prudential chief, one of the best-known names in finance, rose from his roots as an Ivory Coast politician to become one of the most prominent black businessmen in the world.

Chairman Urs Rohner has been warring with Thiam for months, ever since it emerged the bank had been spying on two of its own executives, including Iqbal Khan, long regarded as a likely successor to Thiam. Thiam, 57, said he did not know the spying was taking place, but said today: “It undoubtedly disturbed Credit Suisse and caused anxiety and hurt. I regret that this happened and it should never have taken place.”

The Swiss press was quick to blame the spy scandal for Thiam’s departure. The Tages Anzeiger said that while “Rohner has prevailed,” he now faces “a mud fight with the important shareholders who have campaigned for Thiam in public”.

Those shareholders include Harris Associates, which believes a Swiss clique opposed to change worked to undermine Thiam. New York hedge fund Eminence Capital had already threatened legal action if Thiam was fired. Rohner was supported by Severin Schwan, the lead independent director on the board. Yesterday, the directors accepted Thiam’s resignation. Thiam, a suave, highly intelligent man, joined in June 2015. In the next four years he was paid a total of £31 million, including nearly £10 million last year.

The annual report makes it clear that, in the event of his departure, the remuneration committee is free to award Thiam as it sees fit.

So while the spy scandal has hurt Credit Suisse’s reputation, he may still land another £10 million for 2019. He is credited with turning around a bank whose fortunes were languishing when he arrived, though the share price remained resistant to improvement.

His strategy to scale back investment banking and push into wealth management didn’t always meet with approval from the Swiss banking establishment, for whom Credit Suisse is a national champion. Thiam will be replaced next week by Thomas Gottstein, who heads the domestic business. He is a more traditional bank executive who has been with Credit Suisse since 1999. He had started as a telecoms analysts for UBS in London.

One observer said: “Tidjane is Mr International. Gottstein looks like other Swiss bankers.” Rohner will stay as chairman until April 2021. Credit Suisse has results next week.

David Herro of Harris Associates told Bloomberg this week: “Outside of the little area of Zurich…we don’t understand this kind of war against the CEO. “ I mean, to be honest, to be very frank, it either seems envy from the competitors or perhaps there is something else — given that Mr Thiam looks a bit different than the typical Swiss banker.”​