UBS shakes up executive board with eye on CEO succession

UBS has shaken up its executive board and split responsibility for its all-important wealth management business between two of the managers most likely to succeed chief executive Sergio Ermotti.

Under the changes announced on Thursday, wealth management head Iqbal Khan will move to Asia and become head of Asia-Pacific, while investment bank head Rob Karofsky will become head of the Americas.

Both men will share responsibility for the wealth management unit as co-presidents.

The Financial Times reported this week that UBS was planning to change the roles and responsibilities of the executives it viewed as most likely to succeed Ermotti in the next few years to give them broader experience.

The bank’s board is hoping to draw up a list of three internal candidates by next year to be ready to take over from Ermotti when he retires, which is not expected to be until at least 2027.

“The [group executive board] appointments that we are announcing today will allow us to continue to progress on our integration journey and realise the expected synergies and efficiencies, while putting even more emphasis on our long-term priorities and growth prospects, particularly in the Americas and Asia-Pacific,” Ermotti said in a memo to staff, seen by the FT.

The reshuffle also sees Credit Suisse chief executive Ulrich Körner and UBS Americas head Naureen Hassan retiring from the bank.

Körner would be the final chief executive in Credit Suisse’s 168-year history, having been in the role when the Swiss bank was rescued by its fierce rival last year. He has stayed in the role since the takeover, but with the merger of the two banks’ legal entities to be completed this week, he will depart.

Karofsky’s new role as head of the Americas will be especially important in the next few years, as UBS concentrates on trying to expand its business in the region, where it trails Wall Street rivals, especially Morgan Stanley.

Khan, who has long been viewed as the most likely successor to Ermotti, was given sole responsibility for the wealth business two years ago.

Restoring a co-presidents structure takes UBS closer to the framework at Morgan Stanley, whose own “bloodless succession” process led to the hiring of chief executive Ted Pick last year and is viewed as a blueprint within the Swiss bank.

Bea Martin, another leading internal candidate for the UBS top job, was recently given responsibility for sustainability in addition to her role of running the non-core and legacy unit, which is charged with winding down and disposing of unwanted parts of Credit Suisse.

Sabine Keller-Busse, who runs UBS’s Swiss business, is viewed as another potential successor.

Karofsky is replaced as head of the investment bank by George Athanasopoulos and Marco Valla, who share the role as co-presidents. Athanasopoulos has held various roles across UBS’s investment bank, while Valla joined only last year from Barclays.

Damian Vogel has taken over as chief risk officer, replacing Christian Bluhm, who had attempted to retire to become a photographer last year, only to be asked to stay in the role after the Credit Suisse takeover.

Stefan Seiler, who is head of human resources and corporate services, will take on responsibility for group communications and branding, while Edmund Koh, who was president of Asia-Pacific, will step down from the executive board and take on the role of regional chair of Asia-Pacific.