Credit Suisse Weighs Overhaul of Wealth Management Business

(Bloomberg) -- Credit Suisse Group AG is weighing an overhaul of its wealth management business, consolidating several private banking units to save costs and centralize control as the sprawling global bank seeks to move past recent scandals.

The move would replace a regional structure, where Asia in particular currently reports into a local leadership in the private bank, according to people with knowledge of the matter. The bank could consider appointing a global wealth management head to oversee the unified business, one of the people said.

Credit Suisse declined to comment.

Even before the bank was shaken by the Archegos Capital Management and Greensill Capital scandals, Chief Executive Officer Thomas Gottstein was working to reduce duplication and simplify the bank’s structure. He combined the investment bank and markets division in one of his first overhauls after taking over, while folding in some Asian markets activity into that unit.

Combining the separate wealth management businesses under global leadership would mirror the structure at UBS Group AG, its biggest rival. There, wealth management is led by co-heads Iqbal Khan and Tom Naratil.

The move would roll back a structure set up by former chief executive officer Tidjane Thiam more than five years ago and may reduce costs as well as present a more unified approach to clients. The lender currently splits private banking across three divisions catering to Switzerland, Asia and Europe, Emerging Europe and Latin America.

Helman Sitohang, Philipp Wehle and Andre Helfenstein currently share responsibility for the bank’s wealth management operations, which have gained importance at the expense of the investment bank. Credit Suisse’s new Chairman Antonio Horta-Osorio told bankers at a recent meeting in London that the firm has a great wealth management business “with ancillary services,” according to several people who heard the remarks.

Credit Suisse is in one of its most difficult periods since the great financial crisis, rocked by the dual Archegos and Greensill Capital blow-ups this year which imposed multi-billion dollar losses and further dented its reputation. Horta-Osorio has pledged a thorough review and said the two crises went beyond any he’d lived through over three-and-a-half decades in the industry.

Reuters reported earlier that the bank is considering folding private banking and other services into one global division.

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