UBS is extending Sergio Ermotti’s tenure as CEO beyond April 2027, as the bank delays its search for a successor, according to a report from NZZ. The board of directors, led by President Colm Kelleher, intends for Ermotti to remain at the helm until the full extent of additional capital requirements for the Swiss banking giant are known.
However, the stated rationale is seen as a pretext for a power struggle between Kelleher and Ermotti, which has now reached a critical point. According to sources, Kelleher has gained the upper hand in the internal conflict.
Ermotti’s plan to quickly replace Kelleher as chairman has reportedly failed. The decision marks a significant setback for the CEO, who had previously been viewed as untouchable and now finds himself in a weakened position.
Ermotti is now facing a largely ceremonial role as CEO, with limited opportunities for success. The financial world is now focused on identifying his eventual replacement, with potential candidates including Iqbal Khan, Bea Martin, Aleksandar Ivanovic, Rob Karofsky, and external options.
This outcome represents a significant penalty for a top executive, effectively assigning Ermotti an expiration date without a firm timeline. The decision by Kelleher and the board underscores the high-stakes environment within global finance.
Kelleher, whose experience is rooted at Morgan Stanley, has demonstrated his influence over the Swiss banking leader. Ermotti had previously indicated, through comments reported by the Financial Times, that he anticipated handing over operational control within a year.
This move was interpreted as an attempt to pressure Kelleher and the board into quickly appointing Ermotti as the next chairman of the financial institution. The plan reportedly involved Ermotti being nominated as full-time vice chairman of the board at the 2027 general meeting, paving the way for him to assume the presidency after a one-year cooling-off period.
However, Kelleher and his allies on the UBS board have thwarted Ermotti’s strategy, doing so with both elegance and ruthlessness. UBS, a key player in the global financial system, is currently navigating a period of significant change.
Ermotti could potentially resign by the end of 2026. It would be the second time his career aspirations have been derailed; former UBS Chairman Axel Weber also blocked Ermotti’s bid for the presidency. Alternatively, Ermotti may choose to cooperate with Kelleher’s plans, though this is considered unlikely given his current position.
He faces a demanding period ahead, overseeing potentially massive layoffs in Switzerland and worldwide, and a relentless focus on cost-cutting. It remains to be seen whether the most prominent Swiss banker since Oswald Grübel will accept these challenges.
