UBS replaces wealth management chief

The move is the second high-profile private banking departure in two weeks

Dec 14, 2017 @ 9:15 am

By Bloomberg News

Juerg Zeltner, the head of UBS Group AG's $1.3 trillion wealth-management unit, is stepping down in January and will be replaced by Switzerland chief and former Commerzbank AG head Martin Blessing.

The move is the second high-profile private banking departure in two weeks after Julius Baer Group Ltd. chief Boris Collardi left the bank for Pictet & Cie. The Zeltner move was reported earlier by Bloomberg.

UBS said in a statement Thursday that Zeltner will retire from the firm in 2018. Axel Lehmann, currently chief operating officer, will succeed Blessing and human resources head Sabine Keller-Busse will assume the role of chief operating officer.

(More: UBS loses $327 million adviser to Alex. Brown.)

Zeltner, 50, has served at UBS for more than 30 years after joining predecessor Swiss Bank Corp. as an apprentice in 1984, UBS said in the statement. He has been on the bank's global executive board since 2009, according to a biography on the company's website. His wealth-management division held 1.28 trillion Swiss francs of client assets at the end of September. UBS also has a separate wealth-management unit in the Americas overseeing $1.25 trillion.

"Zeltner's departure is surprising; the question is whether he will be Collardi's successor at Julius Baer if his contract allows it," Andreas Brun, an analyst at Mirabaud Securities in Zurich, said by phone. Sergio Ermotti "won't do the UBS CEO job for too much longer. Potentially Blessing could take over in a few years."

UBS declined as much as 1.2% in Zurich trading and was down 0.6% at 17.75 francs as of 9:30 a.m. The stock has climbed 11% this year, giving the company a market value of 68.5 billion francs.

(More: UBS broker-protocol exit shows independent channel is bleeding wirehouses of advisers.)

Blessing, 54, currently helps oversee domestic retail banking and corporate lending to Swiss clients. He stepped down as head of Commerzbank in 2016 and started his role at UBS in September of that year.

Wealth management is a key profit driver at Zurich-based UBS. The division's third-quarter earnings before tax rose more than 16% from a year earlier, beating analysts' estimates. Overall net new money was 4.6 billion Swiss francs, mainly driven by inflows from wealthy Asian clients.

UBS is focusing on the business after scaling down its investment bank. While it's the biggest wealth manager in the world, it faces pressure from shrinking margins, subdued client activity and low-to-negative interest rates.

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