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awareof the financialecosystem beyondthe‘onebank’marketing mantra.“All seniorbankersshould spendtimewiththemostjunior marginclerkswholiquidate client positions in securitiesand commoditieswhenamargincall arises,”saysMrCornwall.“Thefancy algorithmsandsoftwarethebanksuse arenomatchforcommonsenseand decisiveleadershipactions.”

LUCRATIVEDEALS This debacle comes hard on the heels of losses to the bank’s ultra- wealthy clients, offered funds fromsupply chain finance firm Greensill Capital, currently under intense media scrutiny due to the involvement of formerUKprime minister David Cameron in lobbying government ministers for access to a Bank of England coronavirus loan scheme. Wealthyclientswere sold the

funds,whichhada$1.2bnexposureto SanjeevGupta’s troubled steelempire. “Bankersworkingwith familiesget introducedto deals theyfeel pressured to raisefundsfor,andthat’swhen the real trouble starts,” says Cara Williams, senior partner for the family offices segment atconsultancyMercer. Herwarningsringparticularly

poignanttothoseclientswholost fortunesto the fraudulent$68bnPonzi schemeoverseenbyBernieMadoff, whodiedrecentlyinaUSprison.His “investments”wereinadvertently facilitatedbymanyprivatebanks. WhileCreditSuissedidnotrespond

toPWM’s requests to discussthese issues, all theformerbankersand consultantswespoketo highlightedan aggressivesales culturein investment banks, enticingrelationshipmanagers toseekthemostlucrativedeals, withoutadequatesafety nets. The ‘one bank’ structure facilitates these activities, but it has feathered

See coverage of PWM’smoral leadership and diversity survey, beginning on page 22

toomany nests to be cast aside. Andit is thriving stateside,with adherents JPMorgan andBankof America currently in the ascendancy. It isEuropewhere problemshave festered, withcosy networks binding families, advisers,banks and politicians together. Dysfunctionalcoteriescanprove financiallyruinousforbanks, clients, governmentsandsocietiesasawhole. Arootandbranchreviewof leadership failures is surelycreepingupthe regulatoryagenda. It istheabsenceofanadequate

“managementbandwidth”tooversee the biggest dealswhichhasbeenmore crucialthananystructural deficiency, saysAminRajan,founderofthe Create-Researchconsultancy.While seniorheadshavealreadyrolled,the “revolvingdoor”atthehelmofmajor banksshouldbecalledintoquestion. AsPWM’s surveyondiversity

andrecruitmentshows, integrity, competenceandcompassionare keycomponentsofmoral leadership in privatebankingandasset management.Buttherearealso rivalpressures bearingdownonour leaders, frombothshareholders andclients.Wealthmanagementis traditionallyalowmarginbusiness. Aggressivecross-sellingnotonly allows privatebankstoboost these profits,butit givesthematighterhold onthe biggest clients,whoselackof loyalty theyconstantlyfear. ForCreditSuisse, storiesofpast

successesmaynotbeenoughtoputthe Zurichgiantbackatthetoptable.There havebeenrumoursformanyyearsof amergerorrescuebyZurichrivalUBS, althoughbothUSandSwissauthorities mayblocksuchamove.“Alloptionsare nowonthetable,”suggestsMrRajan, witha“miracle”neededto returnthe bankto its formerglories.“CreditSuisse facesaHerculeantasktoreviveits fortunes.”

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