UPDATE: July 27, 2021: Credit Suisse hired Goldman Sachs’ deputy chief risk officer to step into the chief risk officer role vacated when Lara Warner stepped down in April amid the Swiss bank’s Greensill and Archegos scandals, Bloomberg, The Wall Street Journal and the Financial Times reported Tuesday.
David Wildermuth will join Credit Suisse by February, report directly to CEO Thomas Gottstein and sit on the bank’s executive board, the publications reported.
Wildermuth is a 24-year veteran of Goldman Sachs who previously served as the investment bank’s global chief credit officer and chief risk officer for Europe, the Middle East and Africa, according to his LinkedIn profile. He became a partner at Goldman in 2010 and has served in his current role since 2015, the Financial Times reported.
Wildermuth “will help shape the group’s enhanced risk management framework, an essential part of the bank’s strategic realignment currently underway,” Credit Suisse’s chairman, António Horta-Osório, said in a statement, according to Bloomberg. Horta-Osório is expected later this year to unveil the realignment, which may include narrowing the investment bank’s size, activities and structure, analysts told The Wall Street Journal.
Unlike Warner, Wildermuth will not also serve as Credit Suisse's chief compliance officer. The Swiss bank separated the risk and compliance functions upon Warner’s departure. Thomas Grotzer is overseeing compliance for the bank on an interim basis. Once Wildermuth joins Credit Suisse, Joachim Oechslin — who had served as the bank’s chief risk officer prior from 2014 to 2019 and is doing so again in the interim — will resume his earlier role as strategic adviser to Gottstein, Reuters reported.
"We picked [Wildermuth] because he has deep experience in both credit and risk, [and] at a leading financial institution," a source familiar with the hiring process told the Financial Times. "It is a demonstration we can still hire top talent from rivals."
The talent drain continues for Goldman Sachs.
Joanne Hannaford, a 24-year veteran of the bank, is leaving to become the next chief technology officer and chief operating officer at Credit Suisse, effective Jan. 1, the Swiss bank said in a statement Monday.
In the COO role, she replaces James Walker, whom the bank said will relocate to the U.S. for family reasons and become deputy CEO of Credit Suisse’s U.S. holding company.
Hannaford, meanwhile, will be based in Zurich and lead the bank’s digital and IT strategy, reporting to CEO Thomas Gottstein. She has served since 2017 as Goldman’s head of technology for Europe, the Middle East and Africa and has been a partner at the bank since 2014. She also is an adviser to the U.K. government and chairs the Bank of England CIO forum.
"Technology is and will increasingly be a key success factor in financial services and with her skills, Joanne is well positioned to lead our strategic efforts going forward," Credit Suisse Chairman António Horta-Osório said in Monday's statement.
Horta-Osório is roughly two months into his stint leading the embattled Swiss bank, which took about $5.5 billion in losses from the March collapse of Archegos Capital Management. Earlier that month, the bank also suffered reputational damage from the bankruptcy of supply chain finance firm Greensill. Credit Suisse said last week it is repaying Greensill investors a further $750 million. That’s on top of at least $5 billion it had retrieved for investors as of April.
The twin scandals have ripped through the bank’s leadership, leaving three vacancies on its executive board — one of which Hannaford will fill. Credit Suisse fired its chief risk and compliance officer, Lara Warner, and the head of the investment bank, Brian Chin, in April. The bank’s asset management chief, Eric Varvel, stepped down from the executive board in March but remains at the bank — and in fact, will serve as Walker’s supervisor once Hannaford comes aboard.
Credit Suisse's strategy
For his part, Horta-Osório said last week a board committee and outside consultants have begun to review the bank’s risk management, strategy and culture.
[Update: Days after this article's first run, Credit Suisse announced it has formed a team to track the trading positions of its major clients and their potential impact on the bank.
The bank’s global head of equity market risk, Amelie Perrier, will lead the effort to police the new function, called counterparty market risk, The Wall Street Journal and Financial Times reported Friday, citing an internal memo.
The move serves as an acknowledgment that Archegos's collapse stretched beyond the credit risk domain Credit Suisse had been set up to monitor at that time — rather posing risk to the full market — and that the bank needs a monitor for a broader picture.
The activities of counterparties such as hedge funds had typically fallen under the umbrella of credit risk, not market risk. Credit Suisse reported a capital requirement of about $2.2 billion for counterparty credit risk as of March 31, but that amounts to only 40% of the loss the bank took from its Archegos involvement.]
Among its rank and file, Credit Suisse has seen a surge of departures — 50 or more from its investment bank in recent months — and offered retention bonuses to some employees there and in wealth management.
The Swiss bank’s head of global mergers and acquisitions left for Morgan Stanley last month, The Wall Street Journal reported Tuesday. A co-head of Credit Suisse’s media and telecom team, meanwhile, is joining Barclays. A co-head of the bank’s global industrials team in the Americas, is joining Lazard. And Credit Suisse’s head of global energy is joining JPMorgan Chase, according to the publication.
Goldman, too, has seen more than its usual share of turnover this year, as its general counsel, communications chief, head of diversity and asset-management co-head have all announced their departure since March. Perhaps hardest hit within the company has been its digital bank, Marcus. The unit's chief executive, Omer Ismail, and head of large partnerships, David Stark, left Marcus in February for Walmart's fintech startup. Marcus's head of product, Sonali Divilek left in April to join JPMorgan Chase. And Marcus's CFO, Sherry Ann Mohan, also exited and joined JPMorgan.
Goldman Sachs declined to comment on Hannaford's departure. But the bank has downplayed executive flight this year. "Our business has serious momentum and a deep and growing bench of talent," Andrew Williams, a bank spokesperson, told Bloomberg when news broke that Ismail and Stark were leaving.
Aside from Marcus's new chief executive, Peeyush Nahar, which the bank hired away from Uber, Goldman has largely been rebuilding its ranks from the inside. It promoted Liz Ewing, formerly chief of staff for CFO Stephen Scherr, to become the digital bank's CFO. Goldman also rehired Marcus's former chief risk officer, Brian King, after he had a short stint at Wells Fargo, and tapped a new chief operating officer, chief commercial officer and top lending executive from within.
To a degree, Hannaford's departure marks a continuing tech drain on the bank that has extended to its rank and file — especially at Marcus — amid an aggressive product rollout schedule that has included the launch of a Marcus app, checking accounts, the Insights personal finance management tool, the robo-advisory service Invest, and work to transition GM’s credit-card portfolio. Among executives, Ismail and Divilek left within months of taking promotions.