By Katie Reid and Sam Cage
ZURICH (Reuters) - Credit Suisse
Kielholz, a former CEO at Swiss Re and currently a vice chairman at the company, will replace Peter Forstmoser, who is stepping down on May 1.
"This is not a clean break for Swiss Re," said Tim Dawson, an analyst at Helvea.
"Kielholz was the person who started the move into alternative risk products. The company needs to make some major changes to restore investor confidence. I am not sure whether this goes far enough."
Swiss Re had already rushed to appoint a new chief executive, Stefan Lippe, on Feb 12 after a disastrous foray into investment banking brought it to its knees.
Hans-Ulrich Doerig, a banking veteran who is currently vice chairman at Credit Suisse, will be promoted to chairman of the Swiss bank's board, the lender said in a statement.
The board reshuffles come just days after Switzerland's largest bank UBS
Writedowns and capital concerns have wiped off three quarters of Swiss Re's market value in 2009 and the reinsurer has had to shore up its capital base with an investment from Warren Buffett.
MIXED REACTION
Shares in Swiss Re opened higher after news of the new appointment but then fell into negative territory after investors gave a mixed reaction to Kielholz's appointment.
Swiss Re was down 2.9 percent at 0932 GMT (5:32 a.m. EDT), in line with the Dow Jones index of European insurers <.SXIP>.
Credit Suisse's stock was down 6.0 percent, broadly in line with the Dow Jones index of European banks <.SX7P>.
"Credit Suisse found someone who is very capable of doing the job with more than 30 years of experience to replace Kielholz," said Dirk Becker, a banking analyst with Kepler Capital Markets.
Credit Suisse, which has said it had a good start to 2009, has not been as badly hit by the financial crisis as UBS and Swiss Re, but still posted a record loss for 2008.
Kielholz said in a statement from Swiss Re that its core business was intact and its prospects were excellent despite disappointing results from the reinsurer.
"I'm confident that at the Annual General Meeting, shareholders will support our proposals to strengthen the company's capital base," Kielholz said.
The appointment of Kielholz as new Swiss Re chairman came as a surprise to some analysts as Swiss media had called for his resignation as partially to blame for the insurer's woes.
"A lot of people are blaming Swiss Re, saying that they should have sacked Kielholz as he was part of the drive into the investment banking strategy," said Rene Locher, an analyst at Sal Oppenheim.
"But the key message is that Swiss Re is trying to keep reinsurance know-how on the board and this is good news."
(Writing by Lisa Jucca; Editing by Mike Nesbit)
