On Friday morning, just hours after he was ousted as Credit Suisse chief executive in the wake of a spying scandal, Tidjane Thiam strode through the front door of the bank's Zurich headquarters on Paradeplatz Square.
It was a strange sight for the company's receptionists, given that Thiam typically takes a private route through the parking garage.
After greeting staff, the 57-year-old French-Ivorian sat down in his second floor office and left the door open. The message, according to one person close to Thiam, was clear: "I have nothing to hide. I do not feel embarrassed."
Thiam's fate was sealed at a mammoth 20-hour board meeting that dragged on until 4am on Friday, where the bank's directors finalised their decision while eating takeaway pizza. It was a "low key, sad" last supper, said one participant.
Two hours later, Credit Suisse announced that Thiam was stepping down.
His resignation capped a four-month corporate surveillance saga that has haunted Credit Suisse and cast a shadow over the entire Swiss banking sector. The fallout has also reignited allegations of xenophobia and racism that have hung over Zurich's insular elite since Thiam — the first black chief executive of a major European bank — was appointed from insurer Prudential five years ago.
At the centre of the drama was a charismatic yet sometimes imperious chief executive accused of showing insufficient contrition over the scandal, which led to the suicide of one of the private investigators involved. Ultimately, he isolated himself from those who had hired and championed him.
The acrimony surrounding Thiam's departure threatens to destabilise a bank that has failed to get ahead of the scandal since it broke last September, and which had barely started recovering from its near collapse after the financial crisis. Shares in the bank fell as much as 5 per cent on the news of his departure before ending the day flat. While they have rallied about 8 per cent in the past year, they have declined by almost half during Thiam's tenure.
Three of the bank's top investors and several of its largest clients had lobbied aggressively in public and behind the scenes for Thiam's survival, but were ignored. They have pledged to continue their fight to unseat Credit Suisse chairman Urs Rohner. The 60-year-old Swiss lawyer recruited Thiam in 2015 — but was ultimately his axeman.
It all began to unravel for Thiam last September, when corporate espionage firm Investigo was caught tailing Iqbal Khan, a former top Credit Suisse executive who had defected to rival UBS.
Khan and his wife confronted the spy on the streets of central Zurich and the affair was quickly traced back to Thiam's right-hand man: Pierre-Olivier Bouée, known as "POB".
Animosity between Thiam and Khan ran deep. Khan, known for his self-confidence, had bought the house next to his boss in Zurich, knocked it down and spent over two years rebuilding on the site.
In retaliation for the noisy building work, Thiam planted trees in his garden that blocked his neighbour's view of Lake Zurich. The domestic spat led to an altercation at a Christmas party at Thiam's house. Rohner negotiated an expedited exit for Khan soon after.
Thiam always maintained he had no knowledge of the spying and was cleared of any involvement by an external law firm. His lieutenant Bouée stepped down and was eventually fired. But the repercussions continued, when in December, news broke that Credit Suisse had also spied on its former head of human resources. This left the board with no option but to force Thiam out because the scandal had started to "damage the company's reputation", Rohner told the FT on Friday.
Board felt provoked
Credit Suisse's board discussed the matter throughout January — keeping investors in the dark, to their chagrin — and privately turned their regular meeting to approve the bank's annual results into one that they planned would end the chief executive's Credit Suisse career.
As the directors geared up for Thursday's board meeting, Thiam irked them further by posting a photograph on Instagram, which showed him smiling with a group of the bank's top executives after a work dinner. It was intended as a display of unity — but it backfired.
"It was a big mistake to use Instagram two days before the meeting. How else could it be taken?" one board member said. "It was a desperate move. To use those people was a bad idea."
At first, the entire board discussed the situation before Thiam broke off into a separate session with Rohner, lead independent director Severin Schwan and John Tiner, chair of the audit committee.
After a couple of hours — described as "surprisingly unemotional" by one person briefed on the discussion — Thiam agreed to step down. His condition was that he be allowed to present the bank's full-year results next week and depart with "good leaver" status, meaning he would keep most of his pay. The directors agreed but said they would dock a significant chunk of his 2019 bonus.
The Instagram post was one of several incidents that provoked the board. Another trigger was an interview Thiam gave to a French TV station after the bank's third-quarter results last November, when he said that not only was it normal to use observation techniques, but every big company did it.
"That was what really pissed the chairman off," said one person briefed on the discussions. "Urs thought, 'he doesn't get it, doesn't get how upset employees are feeling'."
Another person involved concurred: "It was as if Tidjane didn't understand the magnitude of it all," the person said. The board believed he had personally orchestrated the shareholder campaign to save him: "I think when history is written . . . that's what really did him in."
His apparent lack of contrition was also a problem. One director pointed out that Thiam's resignation statement, in which he expressed "regret" while denying knowledge of the spying operations, was the first time he had "directly apologised" for the affair. "It is ludicrous when you think about it," the person said.
"Being a turnround expert is different to fitting-in in Switzerland," said one person involved. "The whole spying scandal spun out of control … he no longer had the credibility to lead us out of this issue. Saying 'I didn't know' wasn't enough."
Investors target chairman
A very different interpretation of events was given by some of the bank's biggest investors. This week they continued to profess their faith in his leadership and came to his defence in the media.
When the chairman's agenda became clear earlier this week, shareholders led by Credit Suisse's largest, Harris Associates, publicly threatened to oust and even sue the chairman if he and the board removed the man they credited with reversing the bank's fortunes.
"We don't want to give up on Credit Suisse because they have a great franchise and they are so undervalued, but they have an incapable chairman, so we will take the steps to get him replaced," David Herro, vice-chairman of Harris, which owns 8.4 per cent of the stock, told the FT on Friday.
"Urs is supposed to leave by 2021, but that's not soon enough … to his already-poor track record, you can add removing a successful CEO," he added. Herro said he would consider supporting other shareholders to call an extraordinary meeting to unseat the chairman. Rohner said in response that investor unrest "was not something which worries me a lot".
Herro has also previously said Thiam may have been a victim of racism. This was echoed by an executive at one of Credit Suisse's biggest clients.
"I believe that there were a lot of articles fed to the Swiss-German press to make tensions rise and the situation untenable," the person said. "It's like a parochial town rejecting a foreign body."
The chairman denied there was a xenophobic angle and said the new chief executive, 20-year Credit Suisse veteran Thomas Gottstein, was not picked because he was Swiss.
"Tidjane is a nice person, a great executive," but his "flaw" is that "he thinks the world is out to get him," said another person involved in the board's deliberations. "He is too thin-skinned, he sees racism everywhere, which of course it is, but it isn't always the reason he is criticised."
Thiam's fans said he has guided the bank through the rockiest period in its history. They cited his negotiation of a US$5.3 billion ($8.2b) settlement with the US Department of Justice over mortgage bonds, and a strategic overhaul of the lender in which he slashed its volatile investment bank and shifted resources into wealth management and Asia.
Earnings are improving too. Credit Suisse's net income surged 45 per cent in the first nine months of last year and the bank has increased wealth assets under management to a record SFr1.5 trillion ($2.4t). Doubts about capital have been dispelled after two rights issues totalling US$10b and years of deep cost cuts.
"The board and media watched the bank being destroyed for 15 years, then they attacked the guy trying to clear it up," said a person close to Thiam. "Where were all the Swiss newspapers when the bank was taking money from African dictators and selling [toxic mortgage securities]? They were never as vicious then."
His record, however, is not unassailable. Credit Suisse's shares have underperformed their peers, and the bank is still suffering from big swings in earnings at the trading unit.
Meanwhile, Thiam has told friends that he already has job offers on the table for when his six-month gardening leave ends.
One of them remembers some advice Thiam said he once gave ex-Deutsche Bank boss John Cryan: "If you have good results, no amount of bad press will kill you," he said. "But he was wrong."
Written by: Stephen Morris, Arash Massoudi and David Crow
© Financial Times