Credit Suisse chief executive Thiam steps down as spying scandal refuses to subside

THE boss of Credit Suisse has been forced out after losing a boardroom battle following a months-long spying scandal that engulfed the Swiss lender.

Tidjane Thiam was ousted after a bitter clash with the bank’s chairman Urs Rohner over the crisis, in which the firm hired private detectives to follow two former staff members.

It is a dramatic fall from grace for Mr Thiam, who made history in his previous job running insurer Prudential as the first black boss of a FTSE 100 business. Credit Suisse employs around 5,500 people in London.

The 57-year-old will now be replaced by Thomas Gottstein, who previously ran its operations in Switzerland and is the first Swiss national to run the bank since 2002.

It is not clear if Mr Thiam will get a pay-off, although sources said he is likely to be treated as a “good leaver”.

Up to 12.7m Swiss francs (£10.1m) of Credit Suisse shares were coming his way under various bonus schemes as of the end of 2018, and he is paid a base salary of Sfr3m. The scandal that

It is not clear if 57-year-old Tidjane Thiam will receive a pay-off from the Swiss lender brought down Ivory Coast-born Mr Thiam erupted in September, when it emerged that Credit Suisse’s former wealth management boss Iqbal Khan had been chased through the streets of Zurich by detectives hired to track him after he quit to work for arch-rival UBS.

Mr Khan was a neighbour of Mr Thiam and it was claimed the pair fell out over a line of trees dividing their two homes in the exclusive village of Herrliberg on Lake Zurich’s millionaire “Gold Coast”, triggering a bitter row at a cocktail party.

The initial spying scandal led to the resignation of two top executives, including Mr Thiam’s right-hand man Pierre-olivier Bouée.

What the bank initially said was a rogue spying case widened as details emerged of additional instances of surveillance. In December, it was forced to admit it spied on a second member of staff, saying its former HR chief Peter Goerke was followed by private eyes for several days in February.

That prompted Swiss market regulator Finma to appoint an independent investigator to look into the crisis.

Then last week it was claimed that Mr Bouée had also ordered his head of security to infiltrate Greenpeace in 2017 after the activist group protested at the bank’s annual meeting.

Mr Thiam has been cleared of any involvement in internal investigations and has repeatedly denied knowing about what happened.

However, Mr Rohner decided the widening problems left him with no choice but to “make a change at [the] top of the house”.

The decision to oust Mr Thiam came despite calls from top investors to keep him in the role. Mr Rohner is now facing calls to leave too from Credit Suisse’s biggest shareholder Harris Associates.

He is currently due to stay until

April 2021.

Credit Suisse shares fell 4pc in Zurich yesterday before regaining lost ground to close up 0.2pc at Sfr12.8.

Mr Thiam will stay on to deliver the bank’s annual results next week.

Hats off to the folk at Credit Suisse. It’s not easy to make the dreary world of Swiss banking sound exciting. In an industry that was literally invented for rich people to hide their wealth, nobody likes to talk. Still, they’re certainly giving it their best shot at livening up proceedings with the sudden resignation of chief executive Tidjane Thiam. Despite a last-ditch campaign by loyal underlings to save his skin, Thiam is out after a bitter boardroom battle that escalated following last year’s extraordinary spying scandal.

The bank had insisted that an incident in which the former boss of its wealth arm had been followed by corporate spooks was an isolated event. Yet it turns out that as well as providing services to the world’s uber-rich, it also has a flourishing side hustle in spying. As if the revelation that Iqbal Khan and his family had been pursued by investigators through the streets of Zurich last September was not embarrassing enough, other cases have emerged.

The bank has admitted that private detectives were hired to follow Peter Goerke, its ex-human resources chief, and is investigating claims that former executive Colleen Graham was put under surveillance in 2017 during a dispute with the bank.

Perhaps it isn’t that surprising in a world where so much importance is placed on secrecy and discretion that mistrust is rife. Still, the repeated use of corporate investigators smacks of a toxic culture where everyone is watching their own back, and that has to come from the top.

Thiam was cleared of having any knowledge of the first two incidents, and they were pinned on Pierreolivier Bouée, former chief operating officer. The third was initially dismissed by the bank as “baseless” but is now being examined again. Yet attempts to paint the cases as the actions of a rogue member of staff were never credible. Bouée wasn’t a nobody, he was a trusted associate of Thiam. They worked side by side for many years at Prudential, Aviva and Mckinsey before Thiam oversaw a reunion at Credit Suisse.

Their close relationship raised many questions. Was this an aberration of Bouée’s character or the sort of thing that was expected of his role? Would he really risk harming his long-standing relationship with Thiam by going behind his back? How did Thiam not know his key lieutenant was having former staff followed?

Whatever the answers to those questions, the buck stops with the chief executive. As for the shareholders who were persuaded to publicly back the chief executive earlier, what were they thinking? Perhaps they should have been demanding answers about Thiam’s leadership, instead of blaming the chairman. One even suggested racism played a part, a serious allegation when no evidence was produced to back it up. Not only did those investors back the wrong horse but they also demonstrated that they have very little time for good governance.

Perhaps they thought ESG was short for espionage.

Dug out of a hole, at a price

There is still much anger among investors in Sirius Minerals at the miner’s fate. Shareholders have been presented with a “take it or leave it” bid from Anglo American that will leave them nursing huge losses.

The frustration is justifiable. Shares in the North Yorkshire fertiliser mine peaked at 44p but 80,000 retail investors, many of whom poured in their life savings, are being offered just 5.5p a share. Anglo is getting it on the cheap and despite calls to sweeten the deal with shares, has stuck with its all-cash approach.

Still the shareholder circular provides a reminder of the alternative. Sirius says without new funds, it will be bust by the end of March.

Investors might also direct their exasperation at Sirius founder Chris Fraser, who convinced them he could get the scheme off the ground in the first place. As the document spells out, another $3bn (£2.3bn) is required for it to see fruition. With the financial might of Anglo behind it, the mine has a very good chance of seeing the light of day, which is good for regional jobs and the UK’S export economy.

‘Perhaps they should have been demanding answers on Thiam’s leadership’