Former Morgan Stanley president Colm Kelleher has been recommended as the future chair of UBS, succeeding Axel Weber, who will stand down next year after a decade as the Swiss lender’s chairperson.
On Saturday morning, Kelleher, a 64-year-old Irishman who worked for the Wall Street firm for 30 years, was named. UBS began an extensive external search for Weber’s replacement, with former Swiss National Bank President Philipp Hildebrand and ex-UniCredit CEO Jean Pierre Mustier mentioned.
“It’s an honor to be able to help shape the bank’s future, and I’m looking forward to working with the board, CEO Ralph Hamers, and the whole UBS team,” Kelleher said in a statement.
“Colm brings tremendous banking expertise to the board, and I’m looking forward to working with him to further shape the future of UBS,” Hamers said.
After studying history at Oxford University, Kelleher joined Morgan Stanley’s London office in 1989. Before going to New York and ascending to the chief financial officer, then president, he led the fixed-income trading department in London. In March 2019, he stood down as the bank’s second-in-command but remained a senior adviser.
According to persons familiar with the situation, Kelleher has decided to take on as UBS chair for a maximum 10-year term and is spending the weekend property searching in the Zurich area.
He will collaborate with Hamers, who took CEO at UBS a year ago and has promised to accelerate digitalization. In a strategic update in February, the former ING CEO from the Netherlands will lay out his vision for the company.
Kelleher, according to Weber, brought to the post a comprehensive awareness of the global banking landscape. “I am confident that his knowledge and skills will be invaluable in ensuring that our firm continues to provide the best possible service to our clients, investors, and staff,” he added.
One of Hamers’ key pillars will be a digital wealth manager for mass wealthy clientele in the United States, which might debut as soon as next year. The move would place UBS in direct rivalry with Morgan Stanley, which is also targeting clients with assets worth between $250,000 and $2 million.
UBS has outperformed most of its European competitors in recent years, owing to its position as the world’s largest wealth manager with a significant presence in Asia. During the pandemic, the Zurich-based company’s earnings soared, and its wealthy clients’ fortunes soared thanks to central banks’ trillions of dollars injected into the world economy.
UBS has also profited from the turmoil at its biggest competitor, Credit Suisse, which has been plagued by scandals and enormous trading losses that have cost it and its clients billions of dollars.
UBS director Jeremy Anderson oversaw the search for the new chair, which was backed by Egon Zehnder, the lender’s veteran headhunters.
According to those familiar with the process, the search included identifying lists of women and Swiss candidates, though Kelleher was ultimately chosen unanimously by the nominating committee.
According to those familiar with the recruitment process, Kelleher received a ringing endorsement from James Gorman, the CEO of Morgan Stanley, who knows Weber and Hamers well. Kelleher will leave his post as Gorman’s senior adviser to assume the UBS job. Kelleher’s past at Morgan Stanley, which the Swiss bank views as a close competitor in terms of business strategy and culture, is part of his attraction to UBS.
Weber spent his entire career at UBS, helping to stabilize the bank following a government bailout by downsizing the investment bank and focusing on wealth management development. UBS became one of Europe’s most successful and valuable lenders as a result of this strategy. In addition, between 2004 through 2011, Weber served as President of the German Bundesbank.
On the other hand, Weber leaves some unfinished business for Kelleher, who will have to assist UBS in navigating several tough legal disputes. In December, a judgment on its appeal against a €4.5 billion court decision in France for assisting tax evasion is expected.
Belgian officials are also looking into a separate case. UBS has set aside $2 billion to cover anticipated legal costs.
Hamers is currently under investigation by a Dutch court for his role in a money-laundering scam at ING. He has categorically denied any misconduct.
Lukas Gähwiler, the bank’s Swiss unit’s chair, will be proposed as vice-chair, succeeding Anderson, who will stay on the board as a senior independent director. Kelleher and Gähwiler will be nominated for election at the bank’s annual general meeting on April 6, 2019.
The bank announced on Friday that Alex Wynaendts, a Dutch insurance veteran and Citigroup board member, will succeed Paul Achleitner as chair of Deutsche Bank next year.
One of Deutsche’s top owners, Cerberus, pushed for Achleitner’s departure in late 2019, unsuccessfully attempting to replace him with Kelleher.
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