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Ackermann quits Zurich after CFO's suicide note

Josef Ackermann, the former chief executive officer of Deutsche Bank AG, walks between conference sessions on day three of the Saint Petersburg International Economic Forum 2012.

Josef Ackermann, the former chief executive officer of Deutsche Bank AG, walks between conference sessions on day three of the Saint Petersburg International Economic Forum 2012.

 

Bloomberg News/June 23, 2012

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By Bloomberg News

Josef Ackermann's abrupt resignation as chairman of Zurich Insurance Group AG came after Chief Financial Officer Pierre Wauthier mentioned him in his suicide note, the company said.

"We were informed that such a letter exists and we are aware of its content," Tom de Swaan, who became acting chairman Thursday after Ackermann quit, told analysts and reporters on Friday. "It's correct that it related to the relationship between Pierre Wauthier and Joe Ackermann. It would be inappropriate for me to further elaborate on this."

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Ackermann, who led Germany's Deutsche Bank AG through the financial crisis in 10 years as chief executive officer, said Thursday he was stepping down from Zurich Insurance after members of Wauthier's family accused him of sharing responsibility for the death. The 65-year-old Swiss national called the allegations "unfounded." The shares rose in Zurich, ending four days of declines.

"They were as clear as they possibly could be that there was no link between what has happened and the financial situation," said Peter Eliot, a London-based analyst at Berenberg Bank with a buy on shares. "That has given people some confidence as shown by today's share price reaction."

Wauthier, 53, a married father of two, had been appointed CFO at Switzerland's largest insurer in September 2011 after previous roles as group treasurer and head of centrally managed businesses. He was found dead at his home on Aug. 26.

An autopsy "clearly pointed to a suicide," Marcel Schlatter, a police spokesman for the canton of Zug, Switzerland, where Wauthier lived, said the following day.

"I have reasons to believe that the family is of the opinion that I should take my share of responsibility," Ackermann said in the statement Thursday. "To avoid any damage to Zurich's reputation, I have decided to resign from all my board functions with immediate effect."

Joerg Neef, a spokesman for Ackermann, said the executive will not comment beyond yesterday's statement.

The departure sent the shares down as much as 3.8 percent yesterday in a third day of declines since Wauthier's death was made public, erasing about $2.4 billion in market value, and left investors grasping for answers. Zurich Insurance rose 1.2 percent to 231.6 francs today.

Missing Estimates

"Today's call didn't reveal any details that would bring an immediate end to the uncertainty currently surrounding the company," said Thomas Seidl, an analyst at Sanford Bernstein in London with a market-perform rating on the stock. "I don't expect this to change over the short term."

The insurer said on Aug. 15 that floods in central Europe and tornadoes in the U.S. contributed to a 27 percent decline in second-quarter net income to $789 million, missing analysts' estimates. The shares have declined 4.8 percent this year, while the benchmark Swiss Market Index has increased 11 percent.

Zurich Insurance CEO Martin Senn said on the call that he wants to make it "crystal clear that there is no link between this news and Zurich's business and financial performance." The company continues to be "very profitable," he added.

The board will look into whether undue pressure was placed on the CFO, according to de Swaan, who said he was unaware of any inappropriate behavior.

"The recent developments have been extremely unsettling and our focus is on ensuring the continued stability of the company," he said. "The board is well aware of the need to strengthen the management team and I consider this to be our top priority."

--Editors: Simone Meier, Frank Connelly

To contact the reporters on this story: Nicholas Comfort in Frankfurt at ncomfort1bloomberg.net; Oliver Suess in Munich at osuessbloomberg.net; Elena Logutenkova in Zurich at elogutenkovabloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnellybloomberg.net

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