AMP appoints Credit Suisse private banker as CEO
SYDNEY: Australia’s AMP Ltd has hired Credit Suisse’s head of private banking in Asia Pacific as chief executive to repair its reputation following four bruising months since a powerful financial sector inquiry revealed board-level misconduct at the firm.
Francesco De Ferrari will start at the country’s largest listed wealth manager on Dec 1, with a one-off payment of A$17.7mil (US$12.95mil) on top of a salary package worth up to A$8.3mil, AMP said in a statement yesterday.
Interim CEO Mike Wilkins, who took over the reins of the 169-year-old firm after the inquiry’s revelations triggered the departure of its CEO, chairwoman and several other executives, said De Ferrari would lead a growth strategy for the company.
“We have designed a remuneration structure to drive the recovery of AMP and recognise the degree of challenge in the task ahead,” Wilkins said.
AMP’s share price has tanked since midApril when the inquiry heard AMP had charged thousands of customers for financial advice it never gave, then doctored a supposedly independent report to the corporate regulator about it, exposing serious flaws in its governance and culture.
AMP shares were 1.9% lower in morning trading, yesterday compared with the broader market that was down 0.6%. But since the shares began trading ex-dividend, the 5 Australian cents decline compared to the 24.5 cent dividend implied investors supported the appointment.
“It is a good start,” said Morgan Stanley analyst Daniel Toohey, referring to De Ferrari’s appointment.
“He is relatively unknown so it’s too early to judge but AMP needs a cultural shift and he comes left of field and that seems positive,” Toohey said.
The revelations by the inquiry, called the Royal Commission, triggered the resignation of AMP’s former CEO Craig Meller, and of Chairwoman Catherine Brenner, who was replaced by ex-Commonwealth Bank CEO David Murray.
De Ferrari, who was also chief executive of South-East Asia and frontier markets for Credit Suisse, said he was committed to changing the company and restoring its reputation. “While 2018 has clearly been a challenging year for the business, I’m confident we can earn back trust which will underpin the recovery of business performance,” De Ferrari said in the AMP statement.
AMP is currently facing multiple class-action lawsuits pursuant to findings of the inquiry, which has said it may also recommend criminal charges.
Credit Suisse said it would replace De Ferrari with Francois Monnet and Benjamin Cavalli, who would run the second-biggest Swiss bank’s private banking business in North Asia from Hong Kong and South Asia from Singapore, respectively.
“Under Francesco’s leadership, we have built a highly successful onshore and offshore private banking business model, and expanded its footprint across the region beyond established key wealth management hubs to capture the opportunities in both mature and emerging wealth markets,” said Credit Suisse Asia Pacific CEO Helman Sitohang in a statement.