(Bloomberg) -- Commerzbank AG appointed Hans-Joerg Vetter as supervisory board chairman, resisting strongly-worded opposition from its second-biggest shareholder, Cerberus Capital Management.

The decision to appoint the former head of a German regional lender is a setback for Cerberus, which started a campaign in June to shake up Commerzbank’s top echelon and strategy. The New York-based private equity firm had firmly argued against his appointment in a letter to the supervisory board, Bloomberg reported on Monday.

Pressure from the U.S. private-equity firm helped remove the lender’s outgoing Chairman Stefan Schmittmann, and Chief Executive Officer Martin Zielke. Cerberus suggested it wasn’t consulted on the decision to make Vetter a leading candidate for the job and it suggested two alternatives for the post.

Cerberus previously issued a demand for two seats on the supervisory board that was rejected by Schmittmann, deepening the conflict between the bank and the investor.

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Filling the chairman role is also a first step toward ending Commerzbank’s leadership crisis that started when Schmittmann, and Zielke jointly announced last month they were stepping down. Schmittmann’s resignation became effective on Monday, while Zielke has said he’ll leave by the end of the year, or when the bank finds a new CEO.

A court still needs to approve Vetter’s appointment for it to take effect.

Vetter’s most urgent task as new chairman will be to find a CEO who will carry forward a new cost-cutting plan that Zielke had been working on before he quit. Commerzbank’s corporate clients head Roland Boekhout is the leading internal candidate to take the job but Chief Financial Officer Bettina Orlopp is seen as a potential alternative, and the bank is also looking for external options, Bloomberg has reported.

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