The Swiss bank deposed its chairman of less than nine months unequivocally. finews.com on the weekend negotiating that led to António Horta-Osório's departure.

An air of triumph was unmistakable in Zurich on Monday following the resignation of Chairman António Horta-Osório from Credit Suisse. «We finally have two Swiss at the top,» was the tone of several Swiss-based executives, in reference to incoming Chairman Axel Lehmann as well as CEO of 23 months Thomas Gottstein.

To interpret this as xenophobia would be a misunderstanding. It simply serves to show the deep frustration that has built up in many employees over the past few years, brought on by the numerous incidents of excess that ex-CEO Tidjane Thiam and now ex-chairman Horta-Osório seemingly allowed themselves, none of which had much if anything to do with an understanding of Swiss society or at least the Swiss understanding of executive management.

Damaged Credibility 

The radical break with Credit Suisse's contemporary history began late on Friday evening, when a handful of top executives and directors including Horta-Osório were alerted to clear their weekend schedules, a person familiar with the matter told finews.com. An internal investigation into the chairman's conduct and travel use had reached a conclusion.

Vice-chairman Severin Schwan as well as directors Richard Meddings and Christan Gellerstad led the board's effort, which quickly concluded over the weekend that not only had  Horta-Osório erred but that the basis for him to remain in the job no longer existed.

Orderly Process

The board believed that Horta-Osório's credibility was too damaged for him to front Credit Suisse's reform campaign. A Wimbledon visit, an attempt to avoid Swiss quarantine only to subsequently ignore it, and Horta-Osório's frequent use of private jet travel led to the decision, several people familiar with the events said. 

On Sunday, Credit Suisse's board told him that he could either resign or they would suspend him and ask for him to be dismissed at the bank's next shareholder meeting in three months, they said. Horta-Osório opted to step down of his own accord in order to draw a line under his nine months in Zurich and to not further imperil Credit Suisse's recovery. «It was an orderly process,» one of the people said.

Damage Control

Credit Suisse considered convening a media briefing for Monday but eschewed doing so because it believed it could more quickly put the matter behind. On Monday, Schwan was sparse in his praise for Horta-Osório: «We respect António’s decision and owe him considerable thanks for his leadership in defining the new strategy, which we will continue to implement over the coming months and years.»

This puts an end to a tortured relationship between Horta-Osório and CEO Gottstein, who went on a damage control offensive last autumn after damaging comments about the power dynamic between the two. «It is true that Horta-Osório had interfered in Thomas Gottstein's handling of operational matters,» a Credit Suisse banker said.

C-Suite Unease

This made it increasingly difficult for the CEO to work with his boss. «For Thomas Gottstein, Horta-Osório's resignation is a welcome move,» the executive said. The CEO and Lehmann, who replaces Horta-Osório on Monday know each other well as former competitors.

Gottstein ran Credit Suisse's domestic unit from 2016 until advancing to the top job in 2020, while Lehmann held the same job at rival UBS from 2018 until last February. The two also share the cultural ability to understand long-simmering frustrations at home with top-earners from outside of Switzerland like ex-CEO Thiam and Horta-Osório.