CS Credit Suisse Group

By Emily Glazer and Jenny Strasburg 

Credit Suisse Group AG said Tuesday that longtime executive Timothy O'Hara, a top lieutenant tasked with helping Chief Executive Officer Tidjane Thiam restructure the European bank, is leaving the firm.

Mr. O'Hara, who late last year was appointed CEO of the bank's global-markets business, was let go and will be replaced by the current co-head of credit, Brian Chin, who will also join the executive board, according to people familiar with the firm's thinking.

The Swiss lender has been one of the worst performers among European investment banks, struggling to cut employees and costs, trim businesses and increase capital cushions to satisfy more stringent bank regulations.

Under Mr. Thiam, the bank tapped investors for about $6 billion of capital in late 2015. But it has been a rocky road, with the firm suffering nearly $1 billion in trading losses early this year.

The trading unit where Mr. O'Hara has long worked has been at the center of Mr. Thiam's efforts to restructure the firm. A spokeswoman for the bank declined to comment on the next step for Mr. O'Hara, who joined the bank in 1986.

New York-based Mr. O'Hara was promoted to oversee the bank's global-markets unit, which trades stocks and bonds and sells research to hedge funds, pension funds and other clients, as part of Credit Suisse's sweeping reorganization in October 2015.

But in the transition to replace Gael de Boissard, who previously led that division, there were questions over the chain of command within the markets business.

According to an April Wall Street Journal article, executives disagreed over who was responsible for the losses as they mounted in late 2015. Mr. de Boissard told the Journal through his lawyer that he "ceased to perform global head of fixed income duties of any kind with effect from the restructuring announcement" Oct. 21 and "ceased to have any reporting line to or from him."

The questions about losses, which came up later, focused on positions that included loans to companies at various stages of restructuring in the energy, utilities and housing industries, and securities backed by junk bonds.

Mr. Thiam said in a statement Tuesday that he is "confident that the management changes that I have proposed...will drive a continued improvement in the performance of our bank." He added that Mr. O'Hara has "contributed enormously," including by steering the global markets division through recent restructuring and by returning it to profitability in the second quarter.

As part of the management moves, the bank also announced that Eric Varvel has been appointed president and CEO of Credit Suisse Holdings Inc., in addition to his current role as global head of asset management. Mr. Varvel has been working at the firm for 25 years.

--Maria Armental contributed to this article.

Write to Emily Glazer at emily.glazer@wsj.com and Jenny Strasburg at jenny.strasburg@wsj.com

(END) Dow Jones Newswires

September 07, 2016 02:47 ET (06:47 GMT)

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