The challenge of Mr Ospel's osmosis

John Eisenhammer meets Warburg's new chief executive in waiting, while John Willcock looks at the hopes of the bank's fund management arm

Marcel Ospel's skill as a motivator is widely admired within Swiss Bank Corporation, but nobody was going to rely on this alone to ensure Warburg's traumatised talent stood by their new boss in this difficult hour. With the ink still fresh on the takeover document, the chief executive- in-waiting of Britain's premier investment bank has moved fast to draw up a defection-stopping incentive package.

"The mechanisms are all lined up. A combination of cash, phantom stock options and SBC shares will be used to signal to those individuals we value highly that we want to look into the future with them. It will be announced in a few weeks," Mr Ospel told the Independent in his first interview with a British newspaper.

Thoroughly demoralised in recent months, Warburg has lost a number of key players, notably in European equities, most of whom have been snapped up by Morgan Grenfell. "We would welcome them back. They have my phone number," says the 45-year-old head of SBC's investment banking activities.

Linked to the incentives is a conscious effort to dampen acute fears among Warburg staff of mass axings once SBC gets down to integrating the British merchant bank into the much bigger Swiss operation. "We have not bought Warburg to shrink it," he says. At the sharp business end, the main overlap is in primary equities, which is where cuts will fall. But the biggest losses are expected in back-office support in the international business. "We have quite some overlap in our global networks, purely in infrastructure terms. Warburg operates in 35 locations, and we are in 32," Mr Ospel says.

For all the high-profile acrimony in the recent past between Warburg and SBC, Marcel Ospel says the two houses make a rare perfect fit, possibly because they are so unlike one another. "You have to understand where SBC is coming from," he says. "We have turned a commercial banking institution into an investment bank. But first, we had to build the product base before we could think of moving on to client orientation."

With acquisition of Warburg, which still requires shareholder approval, that transformation is set to take a quantum leap forward. Client orientation lies at the heart of the British merchant banking culture, and is something Warburg has done well. "It is going to determine very much the culture of SBC. We are a high-tech, product-driven organisation, as opposed to the Warburg culture of corporate finance, of client focus. Warburg's franchise will complement and reinforce SBC's risk management product range."

No one is more aware of what such a transformation means than Mr Ospel, who at the tender (by Swiss standards) age of 40, was put in charge of spearheading the high-risk thrust into the investment banking jungle.

Mr Ospel was not one for half measures, leapfrogging his more established rivals at UBS and Credit Suisse by buying O'Connor Partners, the Chicago- based derivatives rocket scientists. The culture chasm could hardly have been wider, but Mr Ospel persisted, forging the basis for SBC's formidable reputation as a derivatives powerhouse. SBC is now the single biggest derivatives player in the City.

Perhaps because of that success, Mr Ospel is not daunted by the challenge of folding Warburg's notoriously arrogant, prickly troops into his bigger battalions. This is not going to be a gentle, arm's-length-to-begin-with process, like Deutsche Bank with Morgan Grenfell or UBS with Phillips & Drew.

"We had the possibility of leaving global risk management on one side, and European investment banking on the other. But we did not want that, and nor did Warburg. The best way to make this succeed is to integrate completely from the start."

One of the more formidable challenges will be what to do about the US market, on which Warburg expended much energy and money only to see its grander ambitions founder. "Until we are properly integrated, we do not have the appetite for domestic US capital-raising activities. Maybe it will be different in two years, but we are concentrating now on strengthening the distribution into the US of non-American instruments, including derivatives and cross-border M&A."

As for the lament that yet another once-great British industry is falling into the hands of foreigners taking over the City, Mr Ospel suggests that such worries are misguided in today's global finance business. "The fact that I am moving to London indicates how seriously we take this city as the pre-eminent international capital market." But that leaves Mr Ospel with another urgent problem - finding a house. "I hope to snatch a few minutes this weekend for house-hunting, but I could do with some advice on where to look."

Start your day with The Independent, sign up for daily news emails
Sport
Floyd Mayweather will relinquish his five world titles after beating Manny Pacquiao
boxing
Arts and Entertainment
tvGame of Thrones season 5 ep 4, review - WARNING: contains major spoiliers!
News
Tottenham legend Jimmy Greaves has defended fans use of the word 'Yid'
people
Life and Style
tech
Arts and Entertainment
The Ridiculous Six has been produced by Adam Sandler, who also stars in it
filmNew controversy after nine Native American actors walked off set
Life and Style
Google celebrates Bartolomeo Cristofori's 360th birthday
techGoogle Doodle to the rescue
ebooks
ebooksA celebration of British elections
Sport
Danny Jones was in the Wales squad for the 2013 World Cup
rugby leagueKeighley Cougars half-back was taken off after just four minutes
News
Florence Welch from Florence + the Machine
people
News
Tiger Woods and Lindsey Vonn are breaking up after nearly three years together
peopleFormer couple announce separation in posts on their websites
News
The Mattehorn stands reflected in Leisee lake near Sunnegga station on June 30, 2013 near Zermatt, Switzerland
news
Arts and Entertainment
film
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Recruitment Genius: Senior SEO Executive

£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...

Recruitment Genius: Online Customer Service Administrator

£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...

Recruitment Genius: Digital Marketing Executive

£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...

Day In a Page

Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living