Magazine

Peter Wuffli


Meet Peter Wuffli in the hushed executive suite of UBS's (UBS) Zurich headquarters, and it's hard to believe he's one of the world's leading bankers. Soft-spoken and unassuming, the onetime journalist doesn't seem to have the force of personality to run Switzerland's ambitious banking and wealth-management group. Yet Wuffli, 46, CEO of UBS since December, 2001, is the managerial brain behind a lucrative cash machine -- one that has as much money under management as France has gross domestic product and is increasingly challenging the titans of Wall Street on their doorsteps and internationally.

There's clearly more to the affable Wuffli -- a father of three whose favored relaxations are the opera and reading Latin American literature -- than meets the eye. Since he took over UBS, with its $971 billion balance sheet and $1.8 trillion of invested assets, the bank's performance has improved dramatically. It is managing risk more effectively and has brought costs under control. Moreover, the bank is gobbling market share in its two key businesses of wealth management and investment banking. As a result, UBS is raking in the money. On May 4, the bank reported its best-ever quarterly profits -- $1.88 billion for the first three months of 2004. That's more than twice as much as in the same period last year. "We have delivered record growth, and that growth is totally balanced," says Wuffli.

Colleagues say UBS has performed so well under Wuffli because he's adept at motivating senior executives and getting them to work together. Wuffli prides himself on running a "one-firm" group, where managers from across the group are expected to leave their egos at home and cooperate closely to devise products and exploit customer relationships to the full.

But Wuffli, who started his professional life writing about economics for the Neue Z?rcher Zeitung newspaper and then did a nine-year stint as a consultant at McKinsey & Co. in Zurich and New York, is also skilled at thinking outside the box. When UBS' rivals slashed staff during the bear market years of 2001 and 2002, for example, Wuffli took a more measured approach. UBS even continued hiring in some areas, especially in the U.S. That, says Wuffli, is one reason the bank is rebounding faster than its rivals now that the world economy is growing again. "[It's the] payoff from investing in our businesses countercyclically over the past few years -- positioning ourselves for exactly these kinds of opportunities," Wuffli says. Now he wants to take UBS to the next level by building up wealth management in Europe outside Switzerland and delving deeper into the U.S. market, where last year UBS switched its PaineWebber investment bank to its own brand. "We see plenty of growth in the U.S., especially in investment banking but also in wealth management," he says.

Of course, it hasn't all been clear sailing. On May 10, UBS was fined $100 million by the U.S. Federal Reserve for illegally transferring dollars from a Fed deposit -- an account set up by the Fed in a commercial bank -- at UBS to Cuba and other countries under a U.S. trade embargo. But the bank's move to dismiss some employees and discipline others after the problem came to light last summer impressed regulators and left UBS with its reputation unsullied. "UBS recognizes that very serious mistakes were made," says Wuffli. With the episode behind him, it's full speed ahead for Wuffli and his big bank.


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