Zurich Financial Services has appointed James Schiro as its new CEO to replace the company's embattled head, Rolf Hüppi.
Schiro is a relative newcomer to Zurich having joined the company as a chief operating officer in March. Analysts say his appointment is aimed at winning back investor confidence after Hüppi's reign lead to four profit warnings last year.
In a statement Zurich said Hüppi would step down as CEO and chairman of the company on May 17. It also thanked him for his "significant contribution" to the group, which he transformed into the third largest insurer in Europe.
The appointment will come as good news to shareholders who have been looking for some ray of financial hope after Zurich's share price dropped 60 per cent last year. The fall was triggered by Hüppi's decision to scrap a 10-15 per cent profit growth target.
Goldmann Sachs, the American investment bank, were one of the first financial house to react to the announcement. One of their analysts, Stephen Dias, said that ZFS shares were his top sector pick for the year and that they would outperform most others in 2002.
Dias said he was targeting a 37 per cent upside potential on ZFS shares on current trading levels.
Former PWC boss
Schiro is no stranger to senior management positions having come from the audit firm, Price Waterhouse Coopers (PWC), where he was CEO for four years. The 56-year-old joined PWC in 1967 after graduating from St John's university in New York with a degree in Accounting and Business.
Schiro saw off competition from a number of people within Zurich to become the firms CEO, none more so than Hüppi's long-standing right hand man, Peter Eckert.
"At least we know there won't be some new guy coming in with all sorts of harebrained schemes to take the group off in all sorts of strange new directions," said Tim Dawson, an analyst at Pictet and Cie in Geneva.
However, Dawson added that Schiro's appointment was "not terribly exciting. It's a bit like Sherlock Holmes. It is the dog that didn't bark."
On Tuesday the company also announced that Vice Chairman Lodewijk van Wachem would take the chairman's seat, also held by Hüppi.
swissinfo with agencies