Will more heads roll at Raiffeisen as a criminal investigation into the lender's former CEO widens? The CEO is vowing to stay put for now.
Raiffeisen Switzerland hastily convened a press conference on Friday following the immediate exit of Chairman Johann-Rueegg-Stuerm overnight. The bank revealed how it intends to work through a scandal that has seen its CEO until 2015, Pierin Vincenz, remanded in custody in an investigation of whether he acted in bad faith.
At the same time, Raiffeisen said that Patrik Gisel is staying put as CEO of Raiffeisen. Gisel continued to enjoy the trust of the board, temporary Chairman Pascal Gantenbein said: the bank's investigations have found that Gisel had no knowledge about any wrong-doing in connection with transactions such as those with Investnet, a private equity vehicle.
Thin Ice
Vincenz is being investigated over allegations he enriched himself with personal investments in firms that Raiffeisen also bought stakes and, later, of representing both buyer (the bank) and seller (himself). He has denied wrong-doing.
If Gisel's job appears secure for now, he is on thin ice: he was Vincenz's protege and, later successor as CEO. More importantly, he was on the board of Investnet, one of the firms being scrutinized by Zurich prosecutors, until 2015. Swiss regulator Finma is also investigating Raiffeisen for potential conflicts of interest, but the overseer doesn't have the prosecutorial might that crime agencies do.
Lax Oversight
Raiffeisen said it strives for a seamless review of Vincenz's tenure, which lasted from 1999 to 2015. Gisel pledged to leave no stone unturned to clean up after the scandal, and pointed to improvements in the bank's corporate governance.
Overnight, Chairman Rueeg-Stuerm sought to put daylight between the bank and the scandal by stepping down immediately. Raiffeisen's detractors have criticized the bank's board as too lax to rein in Vincenz, an ambitious and dynamic Swiss banker who ran Raiffeisen for 17 years. Ruegg-Stuerm dismissed the criticism, though conceding that hiring Vincenz's wife as head of the bank's legal department was an «unfortunate combination».
