It's a potentially brilliant scheme.
Two years ago, JD quietly makes a few well-placed calls recommending CS as a candidate for our new CEO. CS fakes being hard to get which erases any concerns our BOD might have about the relationship and they even pay up for him. Now JD has a friend sitting at the helm of one of his major competitors.
CS wants to “simply the business” and “cut costs”.
So he starts selling off profitable LOBs. (Huh? They are making money but not ENOUGH money????)
He stops our FAs from working with all international accounts (Huh??? You want to REDUCE rather then EXPAND our capacity to do business ???? )
He quietly alienates experienced employees and management teams which creates a toxic corrosive atmosphere from the inside out.
He spends much of the bank’s capital on company stock buybacks rather than improving the firm’s infrastructure and long -term stability. The rising stock price temporarily keeps investors happy which prevents anyone from asking too many questions.
He spends more of the bank’s capital on bringing in more inside men and even creates new executive roles. (Huh? I thought we were trying to cut costs??? Who are these people and why are we paying UP for them??? )
He never communicates any long-term goals or strategies for the bank. Nothing new, Nothing promising. Puts out a couple new credit cards to make it appear as if he’s trying. In fact, he’s nearly invisible as a leader. (People keep their mouths shut when they are hiding something. Less chance to say something you shouldn’t.)
A few years from now, WFC either:
- goes belly -up from shrinking profits and inability to compete in a rapidly changing world, or
- shrinks to a size where (surprise!) JD can buy us.
And WFC is out of the picture as a once major competitor, and everyone is scratching their heads wondering how it all went so wrong.