ZURICH, March 30 — Straight from a class room to trading securities while just a teenager, Sergio Ermotti has had a career which tracked the Wall Street boom that started in the...
ZURICH, March 30 — Straight from a class room to trading securities while just a teenager, Sergio Ermotti has had a career which tracked the Wall Street boom that started in the 1980s, and culminated with him fixing Switzerland’s biggest bank after it fell victim to the last financial crash.Ermotti was originally propelled into the role of chief executive at UBS Group AG in 2011 by a rogue trader scandal. He helped rehabilitate the bank before leaving nine years later.
Ermotti will have to lay off thousands of staff and pare back the investment bank that bears much of the blame for Credit Suisse’s demise, while reassuring the world’s wealthy that their money is still in good hands. Critically, Ermotti is Swiss, which may give him an advantage in selling the deal at home, where many are angered that the government has had to rescue a bank beset by scandal and best known for its cowboy culture.Swiss politicians are on edge following the bank rescue as they prepare for national elections in October. The deal creates a new bank with assets roughly twice the size of the Alpine nation’s entire economy. It is also laden with complex financial derivatives.
“This is not a Swiss solution,” said UBS Chairman Colm Kelleher, seeking to play down any role of Ermotti’s nationality in getting the job, while later conceding: “Being Swiss helps.” Ermotti, who at the time played up his Swiss roots, pledging to return the bank to its former glory, is given credit for its recovery.
Analysts and investors are worried. KBW downgraded UBS shares. Credit rating agency Moody’s adjusted their view on the outlook for some of the bank’s ratings to negative.
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