Swiss private bank Julius Baer’s hiring of Jimmy Lee as Asia-Pacific CEO has surprised industry players, who expected the firm to turn to one of its long-serving regional deputies.

It has been predicted that the hiring will create tensions within the firm after two regional chiefs were passed over for the top job.

But the private bank’s global CEO has defended the move, saying that Lee’s familiarity with the business and his future colleagues, coupled with his neutrality as an outsider, would inject new energy into the organisation.

The bank yesterday announced the appointment of Lee, who was recruited from Credit Suisse.

Lee will join Julius Baer on October 1 and assume the role of Asia head on January 1, 2016. Lee will take over from Thomas Meier, who will return to Zurich to become non-executive vice chairman of wealth management on January 1 next year.

A senior industry source in Hong Kong, who declined to be named, told AsianInvestor: “Jimmy’s appointment is a huge surprise. I would have expected Julius Baer to promote either Kaven Leung or David Lim.”

Leung is the deputy head of Asia-Pacific and North Asia CEO, while Lim is Singapore CEO and head of private banking for Southeast Asia.

“Of course, Singapore is Julius Baer’s hub, which would stand against Kaven who is North Asia CEO based in Hong Kong,” the source noted. “But David is based in Singapore, which is where their credit team sits, reporting directly to Zurich. You would think both of their noses [Leung and Lim] would have been put out of joint with Jimmy being appointed above them.”

Boris Collardi, Julius Baer’s chief executive, told AsianInvestor that he did consider internal candidates but decided to go with an external hire.

“I have considered internal candidates as a first priority. I’ve decided our internal candidates are strong in their current positions, and for the continuity of our strategy it is better to bring in someone from outside,” Collardi said.

“We have a strong leadership in Southeast Asia and North Asia and both leaderships today are embarking on a multi-year strategy… and it’s too early, considering the high growth potential of Asia, to take one of them out of the nest.”

Collardi said the choice of external candidate was as important as the decision to go for an external candidate.

“The choice of Jimmy Lee is a conscious one. He is known in the industry, had worked with many at Julius Baer before. It will be a reunion more than a revolution here,” Collardi said.

In the past Lee had worked with Collardi, Lim and Meier at Credit Suisse.

“It will be stimulating for someone to come in a neutral way to look at the business, who knows the business, had worked for a Swiss firm and knows how we operate - these are assets that more than compensate [the fact] that he came from outside,” Collardi said.

Collardi said he expected both Leung and Lim to remain in their respective posts. However, the industry source said the appointment of Lee would create tensions within the organisation.

“The baseline for the decision is that Kaven can remain as deputy and both [Kaven and David] will remain in charge of the respective region,” Collardi said.

When asked if there would be other changes in the organisation, Collardi said there could be in other satellite functions but he would leave the practicalities of this to the discretion of the new leadership.

“You can safely assume that we will continue to grow faster in Asia," Collardi said. "What I am expecting is winning market strategies and to go out there and hire the people that will propel the business. We’ve made significant growth allowance now available to Asia and I expect the management team under the leadership of Jimmy to deploy that growth allowance to continue our growth trajectory.”

In terms of strategic direction, Collardi said he expected the new leadership to take the business to the next level. Asia has grown exponentially – the region contributed 10% to the overall asset base in 2011, but has surged to 25% today.

Julius Baer has more than 1,000 staff in Asia, including around 250 bankers. Collardi declined to put a number on how the business should grow in terms of AUM and headcount. But he said he expected an increased headcount not only on the front line but also in the mid- and back-office.

Collardi said the next phase he was looking into, on the back of a new IT platform, was to delegate operational tasks to Singapore and turn the office there into a centre for global operations. “That’s something we are exploring,” he said.

Julius Baer does not disclose an exact figure for Asia AUM, but the region accounted for nearly a quarter of the group’s global AUM of SFr284 billion ($290.7 billion) at the end of June 2015.