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Khan's Abrupt Credit Suisse Exit Deepens Zurich Talent War

Iqbal Khan has been chief executive officer of one of the biggest profit centers at the bank.

Khan's Abrupt Credit Suisse Exit Deepens Zurich Talent War
A Credit Suisse logo hangs in the entrance to Credit Suisse Group AG’s headquarters in Zurich, Switzerland. (Photographer: Stefan Wermuth/Bloomberg)

(Bloomberg) -- The abrupt departure of a potential heir apparent at Credit Suisse Group AG marks a compelling twist in the power plays transfixing Zurich’s intimate private banking world.

Iqbal Khan’s leaving as head of Credit Suisse’s international wealth-management unit confirmed persistent speculation that he’s been in talks with crosstown rivals including UBS Group AG and Julius Baer Ltd. The executive is departing immediately -- though there was no statement on his future role -- removing a contender to succeed Chief Executive Officer Tidjane Thiam and a driving force at one of the Zurich-based bank’s biggest profit generators.

Khan's Abrupt Credit Suisse Exit Deepens Zurich Talent War

His exit is a further sign of the intense competition among Switzerland’s top wealth managers to attract -- and keep -- their best private bankers as they accelerate a push towards managing money for the world’s wealthy. Khan, known for his smooth investor presentations and quick ascent through the ranks of Credit Suisse, was responsible for perhaps the bank’s most important unit as he spearheaded the push to win more wealthy clients in areas such as Europe, the Middle East and Latin America.

Julius Baer

The executive, 43, could be poised to take a post atop smaller rival Julius Baer Group Ltd., Swiss daily Tages-Anzeiger reported, citing unidentified people in the financial industry. Julius Baer hasn’t made any statement and a spokesman said the bank won’t comment on speculation. Philipp Wehle, the wealth unit’s chief financial officer, takes over from Khan.

Khan is still weighing next steps and expects to make a decision by the end of the summer, according to two people with knowledge of the matter. He’s held informal talks with UBS and Julius Baer, though it isn’t yet clear if he will ultimately join either of these lenders or another bank.

It’s the latest high-profile departure among ambitious executives to shake up the Swiss banking world. Andrea Orcel, a star UBS investment banker, left the lender in September in a bid to become chief executive officer of Banco Santander SA. That offer was later rescinded in a dispute over pay. UBS also lost wealth management head Juerg Zeltner while Julius Baer is still said to be seeking a more permanent replacement for former CEO Boris Collardi, who moved to Geneva-based bank Pictet & Cie.

Shares Drop

Credit Suisse dropped as much as 1.4% in Zurich and was trading 0.7% lower at 11.8 francs as of 2:56 p.m. local time. The stock has gained about 11 percent this year.

If Kahn does go to Julius Baer, he would reunite with Romeo Lacher, a former Credit Suisse banker who became chairman of the smaller firm in April. The pair once worked closely together, and Khan has been on a shortlist of candidates to potentially replace the firm’s CEO, Bernhard Hodler, people familiar with the matter said in May.

Speculation had been swirling for months that Khan might leave Credit Suisse. He joined the bank in his late 30s after a rapid ascent through the ranks of Ernst & Young‘s Zurich-based assurance division, where he audited UBS Group AG. He joined Credit Suisse in 2013 and was named head of the bank’s international wealth-management unit when it was created. He has a degree in international business law from the University of Zurich.

Khan's Abrupt Credit Suisse Exit Deepens Zurich Talent War

“Under his leadership, IWM has delivered strong financial results, while enhancing our client franchise and achieving industry leading growth over the period,” Thiam said. “I thank Iqbal for the strong results he delivered during his time leading IWM and wish him well.”

At Credit Suisse he made a name for himself by helping to fold worldwide asset management and private banking activities into a single unit. He also built up capital markets and a lending platform for billionaire clients. When Tidjane Thiam joined the bank and revamped his executive team, Khan was already one of the most influential people there and his career accelerated. He’s described by colleagues as confident and thoughtful, fiercely ambitious and adept at understanding and working the levers of power.

Wehle, 45 joined Credit Suisse in 2005 and has served as the unit’s finance chief since its inception in 2015. He previously held finance and strategy senior management roles in Credit Suisse’s Swiss business and international private-banking divisions.

He “is an excellent addition to our senior leadership team, reinforcing the team’s performance culture with strong personal values,” Thiam, 56, said in the statement. “Philipp is an outstanding leader and manager, with an impeccable track record of generating strong revenue growth while driving cost and capital discipline.”

Credit Suisse had split its key international private-banking unit into several new regions last year to boost local decision-making in the hunt for new business. It already has separate Asian and Swiss wealth units, with the combined entities contributing about 40% of revenue.

To contact the reporters on this story: Patrick Winters in Zurich at pwinters3@bloomberg.net;Sridhar Natarajan in New York at snatarajan15@bloomberg.net

To contact the editors responsible for this story: Dale Crofts at dcrofts@bloomberg.net, ;Michael J. Moore at mmoore55@bloomberg.net, James Hertling

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