Sergio Ermotti has been confirmed as chief executive of UBS, a position he has held on an interim basis for the past seven weeks or so.
Ermotti stepped up when Ossi Grübel stepped down in the wake of the bank’s rogue trading losses. A UBS statement says that Ermotti was appointed full-time “after it completed a long evaluation process”.
Seven weeks is certainly a long time in financial markets these days, but the chances are that the pack of alternatives to Ermotti was very lightly stacked.
UBS may trumpet the power of its wealth management business and its Swiss-imposed jumbo capital base, but it remains a bank in crisis that will undoubtedly shrink before it can grow again.
That shrinkage, notably in its investment bank, was a job for someone near the end of their career. Grübel should have stayed on. Ermotti is seen as a safe, uncontroversial choice.
Or is he? This is a banker who, less than a year ago, wasn’t considered good enough to be the chief executive of UniCredit. We all know how much trouble UniCredit is in right now. It says something of how far UBS has fallen that, in the senior management stakes at least, it is now considered less than its Italian rival.
One final thought on UBS’s management: at least the board has had the sense to bring forward the date that Axel Weber becomes chairman from 2013 to May next year.
That’s the next official opportunity for Weber to take the helm, as it’s the date of the AGM. But in times of crisis, you need to be able to switch leaders quickly and bring in people respected by the markets: ask the Greeks or the Italians.