Obama and UBS Executive’s Strained Fundraising Relationship
One of the biggest banks in the world wants the president’s favorite banker muzzled.
The banker, Robert Wolf, a top UBS executive in New York, is among President Barack Obama’s leading fundraisers, building more than $500,000 for his re-election so far this year.
A regular presence at big campaign fundraisers, Wolf, who is 50, golfs and vacations with Obama and is known for e-mailing friends photos of himself with the president.
While such a close relationship might have been envied by other bankers in 2008, when much of Wall Street was infatuated with Obama and donated heavily to his presidential bid, it has been making other UBS executives uneasy of late.
The president’s relationship with financial executives has been decidedly chilly after some critical comments about bankers and the administration’s push on financial regulation.
With media reports pointing out that one of the bank’s top executives is also one of the Obama campaign’s top bundlers — a word that one UBS executive said “makes people’s hair stand on end” inside the bank — the Swiss banking giant has decided to take an unusual step.
The bank’s powerful group executive board in Zurich recently presented Wolf with an edict directing him to report all his media inquiries to the firm’s press office. Since then, most of the requests to speak to Wolf have been rejected, according to people briefed on the situation, resulting in a much dimmer limelight for Wolf.
The move to muzzle Wolf is unlikely on its own to hinder his ability to raise money, even if he may have to do it more quietly than before. Obama is raising far less on Wall Street than he did in 2008, while Republican nominee Mitt Romney is enlisting a number of big donors there.
Yet the contretemps within UBS may be more about office politics than national politics. After a series of setbacks, including a $2 billion loss blamed on a rogue trader in London, the bank is struggling to turn itself around.
Several executives, most notably Robert McCann, have been jockeying for a bigger role in running the bank. McCann was elevated recently, while Wolf lost some responsibilities.
McCann, 54, who is chief executive of UBS in the Americas, and Wolf, who is chairman of the Americas, do not get along, according to people inside the bank.
Largely through his relationship with the president, Wolf has become the public face of UBS in the United States, even though McCann, a former Merrill Lynch executive, now outranks him.
“This stuff is right out of the movie ‘Mean Girls’ but it involves grown men,” said one person with knowledge of the bickering who declined to be identified commenting on an internal matter.
McCann’s anger over Wolf’s public image has been brewing for months. In late March, the executive fired off an e-mail to a number of people at UBS discussing what responsibilities Wolf should have. Recipients were surprised to find details of Wolf’s compensation at the bottom of the message.
The e-mail showed that the executive made a base salary of $900,000, according to people who viewed it. It is not clear whether his overall compensation was included in the e-mail, but the banker makes more than $5 million a year, according to several people briefed on the matter.
The tension within the bank boiled over after Wolf found himself profiled in a number of media reports. The Wall Street Journal in April called him “A ‘Fat Cat’ with the President’s Ear.”
A few weeks later Wolf was presented with an e-mail reminding him of the firm’s policy on media relations, which his bosses thought he had violated. That document contained specific language outlining what was expected of his relationship with the media.
“You will clear any and all communications with the press as far in advance as possible,” the directive to Wolf read. “With respect to activities outside UBS you will, on a best-efforts basis, keep corporate communications informed.”
A UBS spokeswoman, Karina Byrne, said, “All employees of UBS are subject to specific guidelines when speaking to the media.”
Through Byrne, Wolf and McCann declined to comment.
Wolf and Obama met in late 2006 at a reception held at the offices of billionaire investor George Soros. The two became fast friends, a relationship that deepened during the financial crisis. According to the 2011 book “Confidence Men” by Ron Suskind, many were looking to get close to Obama by March 2008.
“But Wolf had been there, a true believer, before the senator won the nation’s popularity contest,” Suskind wrote. “That counted for a lot.”
And as some other Wall Street supporters have since turned against the president, Wolf continues to stand by him.
During the years when Wolf was growing closer to Obama, McCann’s star was rising at UBS. McCann was hired by UBS in 2009 to run the firm’s wealth management unit after spending nearly 25 years at Merrill Lynch, and is credited with turning around that unit.
Then, in what is widely considered a stroke of good fortune for him, Sergio Ermotti was appointed chief executive late last year.
The two executives have known each other for years, dating to their days at Merrill. Ermotti soon asked McCann to be the chief executive of UBS Americas.
Around this time, Wolf’s office was moved several blocks away from the bank’s main Manhattan location. He also lost responsibility for community and government affairs. While some people at UBS see these moves as a demotion, others argue that it more closely aligns his title and responsibility with what he does, which is to drum up investment banking business for UBS.
McCann is no stranger to internal politics. At Merrill, he sometimes clashed with the firm’s chief executive, John A. Thain. In 2008, Thain held a firmwide meeting to discuss Merrill’s sale to Bank of America and was asked if a newspaper report saying McCann would lead wealth management at the combined company was true.
‘’Well, Bob, can you tell us about what is in today’s paper?” Thain said, staring at McCann, implying that he leaked the news, according to several attendees.
Turning red, McCann did not respond, these people say.
The New York Times