* Annual savings of 200 mln Sfr
* 550 jobs to go as part of 1,500 cuts announced on Nov. 1
* Integration to be completed by end 2012
* Swiss private banking under pressure amid offshore clampdown (Adds details, comments from news conference)
By Emma Thomasson
ZURICH, Nov 15 (Reuters) - Credit Suisse Group AG will fully integrate private bank Clariden Leu into its organisation, ending the 250 year-old Leu brand and cutting jobs to achieve 200 million Swiss francs ($220 million) in annual cost savings.
Credit Suisse said the step was part of plans announced earlier this month to increase the contribution of its private bank to group pretax income by 800 million francs by 2014.
The integration would mean a total of 550 jobs will go at Clariden Leu and Credit Suisse as part of an overall staff reduction of 1,500 announced across the group on Nov. 1. , said Hans-Ulrich Meister, the new chief executive of Credit Suisse private banking appointed in July with a mandate to boost efficiency.
Meister told a news conference the decision to fully integrate Clariden Leu was the result of worsening industry conditions in recent months, particularly for smaller private banks that are more reliant on offshore business than big banks.
“We could close our eyes and hope the good, old times come back but we’re not going to do that,” he said. “There have been brutal changes in the environment.”
As cash-strapped governments worldwide have demanded more help hunting tax cheats, Switzerland has been forced in recent years to weaken a tradition of strict bank secrecy that had helped it build up an offshore industry worth $2 trillion.
Clariden Leu had seen three years of net client outflows since it was established in 2007 after the merger of Credit Suisse’s five independent private banks, taking its name from two of them -- Clariden Bank and Bank Leu.
Credit Suisse shares fell 4.8 percent to 21.25 francs by 1139 GMT, underperforming a 3.2 percent weaker European banking sector index after news on Monday that ratings agency Moody’s was putting the bank’s AA1 rating under review for a possible downgrade.
“We believe an integration of Clariden Leu makes sense,” said Vontobel analyst Teresa Nielsen, adding she did not plan to change her estimates for the bank.
Clariden Leu, headquartered in a grand building guarded by lion gargoyles on Zurich’s exclusive BahnHofstrasse shopping street, has 1,770 employees and 15 offices worldwide managing 94 billion francs in assets, down from 129 billion in 2007.
Its forerunner Bank Leu was established in 1755 by Johann Jacob Leu -- later mayor of Zurich -- and counted Empress of Austria Maria Theresa among its clients.
The state-owned Bank Leu went private in 1798 to protect client money from the newly formed Swiss republic after Napoleon-led troops from France stormed parts of Switzerland.
The bank’s past became the subject of controversy last year when Credit Suisse resisted granting access to its archives to historians researching the financing of the slave trade.
Switzerland’s oldest bank agreed to be bought by Credit Suisse in 1990 after its reputation was hit in the 1980s by involvement in major U.S. and British financial scandals.
Credit Suisse named Hanspeter Kurzmeyer -- until recently head of private clients Switzerland -- as the new CEO, replacing Olivier Jaquet, who had only taken over in February.
Kurzmeyer will also be head of the integration project, which is expected to be completed by the end of 2012.
The move is the latest sign of strain in the Swiss private banking industry given rising costs and falling revenues compounded by offshore clients withdrawing their assets.
Both Credit Suisse and Clariden Leu this month began telling U.S. customers suspected of offshore tax evasion that they will disclose their names to the Swiss authorities as they respond to a U.S. tax investigation.
While Meister said the integration of Clariden Leu was in part a response to the need to transform the cross-border business model, he denied it had any link with the U.S. probe.
Rival Swiss private bank Julius Baer said on Monday it is to take a 50 million francs charge for a cost-reduction programme that includes 150 job cuts.
Meanwhile staff at private bank Sarasin are also fearing for their jobs as controlling shareholder Rabobank considers selling its stake, with Baer mulling a possible offer that would likely involve significant cost cuts. ($1 = 0.907 Swiss Francs) (Editing by Jane Merriman and Erica Billingham)