Either Tidjane Thiam remains as CEO of Credit Suisse – or Chairman Urs Rohner will be voted out: the bank's largest shareholder is spearheading a campaign of fellow investors.

David Herro, deputy chairman of U.S.-based and French-owned asset manager Harris Associates, upped the ante in a Credit Suisse leadership crisis. After signaling that Harris supports Tidjane Thiam, the Swiss bank's CEO, Herro reinforced his remarks with what is effectively a threat.

Credit Suisse's directors, led by Chairman Urs Rohner, should marshall around Thiam and protect the CEO from an «orchestrated attack» outside the company, which Herro doesn't more closely define, in a letter viewed by Swiss outlet «The Market». Buckling under the pressure would demonstrate weakness and only encourage more such attacks, Herro said.

Going Hostile on Urs Rohner

Herro (pictured below) is even clearer on what happens if his demands aren't met: «We conclude that Mr. Rohner is apparently attempting to remove Mr. Thiam from his position. That's why we're demanding the board immediately remove Urs Rohner if he is not in a position to publicly support Tidjane Thiam as CEO.»

David Herro

And, according to Herro: «If the board doesn't act in accordance, we'll look for other ways to have Mr. Rohner removed from his role as chairman.» The threat represents an escalation in a drama-rich, months-long scandal of executive spying at Credit Suisse which has left Thiam fighting for his job. 

Garnering Support

The frank U.S. fund manager garnered support for his demands from another, far more secretive shareholder: Silchester, a privately-held U.K. based investor in asset and wealth managers. Silchester, which holds 3.3 percent of Credit Suisse, said it can't see why Thiam should not continue, and that Rohner should step down next year – echoing Herro's scenario in very similar words.

Rohner, who also chairs Credit Suisse's conduct committee, and ex-British regulator John Tiner coordinated an outside investigation. The law firm tasked with the job said it found a rogue, one-man operation to shadow Iqbal Khan, on his way to archrival UBS, as well as – later – another top executive.

Third Spying Incident?

Thiam was absolved in the scandal, but his long-time associate, Pierre-Oliviér Bouée, resigned and was fired retroactively two months later when the second spy case surfaced. It is now clear that Rohner and Tiner's initial efforts to stanch the scandal failed miserably.

Specifically, the white-collar law firm tasked to investigate last week questioned a third ex-bank executive who claims she was also followed by a private detective, finews.com has learned. Loose ends like a Swiss criminal probe and regulatory investigation remain.

Share Price Ructions

Neither big investor made any reference to how an irreversibly damaged relationship between CEO and chairman should nevertheless last for another 14 months, or how Credit Suisse's home regulator should be dealt with. The crisis is to be addressed at a previously scheduled board meeting this week.

Herro's remarks represent a tactical defense measure: Harris Associates has no interest in ructions to Credit Suisse's share price that a management change would likely induce. The fund manager and other big shareholders ensured Credit Suisse was flush through two cash calls since 2015 – and wants to protect its investment. In the last 12 months, Credit Suisse's stock outperformed the wider European banking sector.