Dealmaker Cryan to shake up UBS as new CFO

LONDON Tue Aug 12, 2008 3:28pm BST

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LONDON (Reuters) - It may be no coincidence that Swiss bank UBS (UBSN.VX) chose John Cryan -- a veteran dealmaker -- as its next finance chief, just as it is splitting its business in three separate units.

The world's biggest bank to the rich ushered the 47-year old Briton in as it made a bigger-than-expected quarterly loss, something that may yet come in useful if the bank chose to hive off assets such as its embattled investment bank.

"(Cryan) is a clear, bright thinker and because he is a corporate financier he might like to do deals," said a former senior investment banker who has worked with Cryan.

"And that in the context of UBS probably means disinvestments of certain business parts," he added.

UBS said on Tuesday it would transform its business into three autonomous units, saying disposals were possible in the future, although none were planned for now.

Cryan's track record shows he knows how to split up a bank.

Last year he helped Dutch bank ABN Amro sell itself to a consortium led by the Royal Bank of Scotland (RBS.L), in what remains the biggest ever takeover of a bank.

Cryan currently heads up the financial institutions group at UBS's investment bank. He will replace Marco Suter -- an ally of former chairman and UBS architect Marcel Ospel who was toppled in the crisis -- on Sept 1.

Cryan has spent most of his 21-year career advising financial companies and has also recently helped steer UBS boards on the financial crisis.

He started his career at S.G. Warburg, which was later taken over by the Swiss Banking Corporation, one of the two founding companies for the present-day UBS.

Cryan may bring months of speculation about the sale of UBS's investment bank to fruition.

"Although UBS states that it is not looking to sell its investment bank, we think speculation regarding this will increase, given the proposed change in group structure," Merrill Lynch analysts said in a note.

UBS has come under continued pressure from activist investor Olivant -- headed by former UBS Chief Executive Luqman Arnold -- to hive off investment banking, which has dented its wealthy customers' trust in the private bank.

The investment bank suffered fresh writedowns and a decline in all three revenue lines: equities, fixed income and advisory.

ZKB banking analyst Andreas Venditti said markets might have already priced in a spin-off of UBS's investment bank given the latest rise in share prices.

"The announced separation of the units might disappoint some in the market," Venditti said.