The election of Romeo Lacher as Julius Baer's new chairman heralds a new era for the Swiss wealth manager. His most pressing task – CEO succession planning – looks tough for surprisingly mundane reasons. 

 The election of Romeo Lacher into office on Wednesday as chairman of Julius Baer marks a new chapter for the Swiss private bank. The «Sturm and Drang» era of ex-CEO Boris Collardi is definitely over: the popular and spirited CEO oversaw years of hot growth but also left Julius Baer mired in several scandals, as he left to become a partner at rival Pictet.

Now, Julius Baer is tackling an $87 million clean-up – the result of a breathless and inconsistent growth strategy which wrought several legal cases and regulatory probes. The bank's board signed off on Collardi's heady growth plans and afforded the star CEO strategic freedoms most C-suiters can only dream of. 

Credit Suisse Survivor

Against this backdrop, the 59-year-old Lacher – a former Credit Suisse top executive who most recently presided over stock exchange operator SIX – has his work cut out for him. His appointment was widely applauded: Lacher enjoys an excellent reputation in banking, has years of experience in trading as well as wealth management, and kept himself afloat in the countless restructurings and revamps in his 26 years at Credit Suisse.

Lacher's approach is more pragmatic than visionary, which will come in handy during Julius Baer's clean-up. His most pressing task? Finding a new CEO to replace Bernhard Hodler, a Julius Baer veteran who turns 59 this year. Hodler, who stepped into the void when Collardi shocked the bank with his exit, has calmed nerves since taking the job 16 months ago but is viewed as an interim boss.

Tainted by Scandal?

To be sure, Hodler isn't a poor CEO – but he has been beset with the clean-up from early in his tenure, leaving little room to design a wider strategy for Julius Baer's next chapter. Hodler, Julius Baer's long-standing risk boss under Collardi, is also too closely entwined with the previous era of hot growth to convincingly represent a fresh start for the bank.

The discussion around succession planning inevitably leads to Iqbal Khan, who trained as an accountant and rose rapidly at Credit Suisse after leaving consulting firm EY in 2013. Khan is scrappier than many of his peers in similar roles, and – like Collardi – doesn't possess the elite pedigree of a traditional Swiss wealth manager.

Coming off just three years of successfully running Credit Suisse's wealth arm, Khan is now viewed as the most promising leadership talent in Swiss private banking. But a move to Julius Baer may be foiled for entirely mundane reasons: the smaller wealth manager probably can't pay him as lavishly as Credit Suisse can, according to a person familiar with the matter.

Pay  Backlash