EXCLUSIVE: Cheers and Fears as UBS Managers Meet New Boss
The fresh smoke signals emanating from UBS Wealth Management Americas headquarters in Weehawken, NJ, are confusing, as might be expected at a time of major transition.
On Jan. 1, Tom Naratil took the reins of the 7,000-broker UBS Wealth Management Americas and of all UBS businesses in the Americas. Within UBS he was that rare American who ascended to the executive board of Switzerland’s biggest bank.
He replaced Bob McCann, a Merrill Lynch lifer who rode into the money-losing UBS Americas brokerage business in late 2009 and is more or less given credit for turning around the unit with the help of a posse of former Merrill comrades.
They did it by firing thousands of low-producing brokers, recruiting dozens of very successful ones with fat but long back-end dated signing bonuses and incentivizing brokers to sell managed money products, insurance and loans to their wealthy investment clients, just as other wirehouses are doing.
read more: Hey, UBS brokers. Happy with Your Comp?
The personality differences between Naratil and McCann are said to be extreme. Naratil, 54, is a Yale graduate with an analytical lens that elevated him to chief operating officer and then chief financial officer of UBS Group. He earned his cred by heading the “Solutions Group” for auction-rate securities, instruments that almost felled the U.S. retail business in the financial crisis in 2008.
Naratil, a career man who joined Painewebber in 1983, also has brokerage stripes. He rose at the retail brokerage to variously run strategy, products and marketing up to and after UBS’s 2000 takeover of PaineWebber. He joined UBS Group AG’s executive board in June 2011.
McCann, 57, is a slap-em-on-the-back, rally-the-troops, highly political manager who learned his craft through a long career at Merrill Lynch. A graduate of West Virginia’s Bethany College, he began in institutional equities and ended at the helm of Merrill’s hallmark retail brokerage business until the company was sold to Bank of America during the crisis. Although he has brought UBS Wealth Americas into the black, some sources believe he was booted upstairs this year to a chairman’s role because his Swiss bosses remain unhappy with UBS Wealth Americas’ still-low margins and high expenses.
Naratil, president of Wealth Manager Americas and of UBS Americas, over the past two weeks has begun “personal assessments” of senior executives, some of whom have been seen stacking their offices with documents to prove their value as they prepare for their interviews, according to a former executive who remains close to many of his former colleagues.
“There are a lot of tight sphincters over there,” said the executive, who described Naratil as “studious” and McCann as “wily,” taking credit for decisions made by his predecessors, such as selling off low-producing branches .
For the past two days, however, the old and the new have been meeting in harmony at the Boca Raton Resort and Club in Florida for UBS Wealth Management America’s annual managers’ meeting. According to one of our correspondents, a 30-year UBS vet who has spent the last 20 as a producing manager, the firm remains solid in comparison to the fireworks at rivals such as Morgan Stanley, Credit Suisse and Merrill Lynch.
Here is his edited dispatch from Boca after the first day of meetings:
Today Bob McCann, [Client Advisory Group head] Brian Hull and Tom Naratil all spoke. McCann got two standing ovations. His speech even impressed an old cynic like me and it reminded me what a strong leader he has been for our business at UBS.
Tom Naratil did a nice job for his 1st time speaking to the group. He is a bit of an accountant, but he seems to care about the firm and gets the joke that the Managers and FA’s really drive the business.
We are all counting on Brian Hull to be the advocate for the Managers and Brokers. He will have his work cut out for him as Naratil is a numbers guy and his team is not that strong. I keep waiting for [Eastern division Advisor Group head] Jason Chandler to show me he’s the guy, but not real sign of it yet.
I’m sure working for Naratil won’t be a picnic for Brian Hull, but I’m still confident in the team and the line-up.
When I compare our management team with any of our competitors…I think 2016 will be a good year for UBS even in these crappy markets. The meeting lasts two more days but so far so good.
What’s your call? Are their stars in our correspondent’s eyes, or has UBS really guaranteed itself a solid transition?