Andrea Orcel (Rome, 1963) is a well-known name within Spanish banking. It is not because he has a past at the head of any of the large entities, but because he starred in a notorious frustrated signing, after Santander chose him to be Ana Botín’s number two in 2018 and, just a few months later, he gave up his job. appointment as CEO due to the high financial cost that it would entail.
Six years later, Orcel is making headlines for something very different: because from the management of Unicredit he is shaking up the entire European financial sector, with several purchase offers at the same time that could turn the Italian bank into one of the largest financial entities in the eurozone. .
“Andrea Orcel’s international experience and strategic knowledge of the commercial banking business strengthen the bank’s team and will help us continue to execute our strategy,” Santander praised the Roman banker in September 2018when he announced a signing where he valued how the Italian knew “the commercial banking business in depth,” as well as his “extensive experience in team management, in more horizontal and collaborative organizations, both in Europe and America.”
The entity headed by Ana Botín had established a profile of a financier with experience in the areas of investment banking – he came from Bank of America Merrill Lynch and UBS – and Santander highlighted that it had already collaborated “with the bank in its strategic decisions.” for almost two decades.” “Understand and share our values and culture,” he highlighted. However, that shared vision did not materialize, basically, because of money.
Just four months after announcing his signing, Santander backed down. The reason, the sum of money that had to be paid to him to compensate for what he would stop earning at UBS. It was “unacceptable,” justified the bank managed from the Madrid town of Boadilla del Monte. The agreement and, also, a relationship that, according to information published by the newspaper ‘Financial Times‘, had already been woven with Emilio Botín.
In the end, Orcel’s frustrated signing by Santander ended up in court. At first, a court of First Instance set the compensation for the manager at 68 million euros. He even asked for 112 million. That sum was reduced in instances greater than 43.4 million and included compensation for moral damages.
The bank is “too arrogant”
Orcel’s career hasn’t slowed down since then. On the contrary, it has accelerated. However, the root of Unicredit’s latest movements – the purchase offer by the German Commerzbank and the Italian Banca Popolare di Milano – must be found in its academic and professional development. The aforementioned information from the ‘Financial Times’ details how the Roman went to class at the exclusive Chateaubriand French Lyceum, where he met the children of aristocrats and diplomats. Later, he graduated summa cum laude in Economics and Commerce at the Roman University of Sapienza – it is said that his thesis dealt with hostile purchase offers – and learned to move among those who make the decisions.
In 2013, when He had been at the Swiss UBS for a year and the prospect of reaching Santander was not even on the horizon, Orcel had to testify before the British Parliament committee that was investigating the manipulation of interest rates in interbank loans (Libor) for which UBS received a fine of 940 million pounds (more than 1.1 billion euros today). In it, he described the banks as “too arrogant and convinced of themselves,” as he detailed. Guardian. “The industry has to change,” he said in a commission where he was defined as “the Ronaldo of banking.” Shortly afterwards it was learned that his salary at the Swiss entity reached 25 million Swiss francs (almost 27 million euros at the current exchange rate), a figure that some politicians of that country described it as “scandalous” when not even five years had passed since the great financial crisis.
After his unsuccessful contract with the Spanish bank, he carried out a interview with the same British mediaconsidered the journalistic bible of the City of London. In “fluent Spanish,” he detailed his disappointment at not reaching the top of the Spanish entity, when he already had a school in Madrid for his daughter and was one step away from buying a house. Also, he delved into his relationship with Botín Sr. “I had a special relationship with Emilio. I think it taught me a lot of things. He understood that by trusting me, the level of pressure he would feel to not fail, to do his best, was enormous. I was lucky to never let him down.”
Years later and already at Unicredit, he assured the US agency Bloomberg that when you are in the top management of a bank “not everyone agrees with you all the time.” “Life is too short to be in an organization where you do not feel supportive or you are losing or are destined to fail,” he stated.
Clash with the governments of Germany and Italy
Today, as CEO of Unicredit, Orcel has shaken the waters of a European bank where everyone looks askance at each other. On the one hand, because it has been buying shares of the German bank Commerzbank, until reaching 21% and with the intention of reaching 29.9%. On the other hand, because this week it launched a purchase offer for Banca Popolare di Milano, with the goal of consolidating the third largest entity in Italy.
These two movements have ties in common. On the one hand, both Commerzbank and BPM are two rescued banks, where the German and Italian States had to take over the shareholding so that they would not fall. On the other hand, because the governments of both countries have shown their reluctance towards two purchase operations that they do not view favorably. In the German case, because control of one of its largest entities would fly to Italy. And in that of Giorgia Meloni, because her plan involved the union of BPM with Monte dei Paschi di Siena, also rescued.
However, Andrea Orcel has looked further up, to Brussels and the European Central Bank. Both institutions have been advocating for years for a stronger banking sector, capable of competing with United States entities. And that is what the Roman banker defends. “In line with the recent European Commission report, Unicredit shares the conviction that a strong banking union in Europe is fundamental to the economic success of the continent and, through it, to the prosperity of each of its nations. Ensuring growth and competitiveness in the German banking sector is essential for both the German economy and Europe as a whole,” the Italian bank justified. argue his landing at Commerzbank.
In 2023, Unicredit earned more than 8.6 billion euros – 54% more than the previous year – thanks to the take-off of interest rates. A figure that was all dividend. Now, with monetary policy on the decline, it wants to grow with purchases and accelerate that consolidation.
“Europe needs stronger and bigger banks to help develop its economy,” says Orcel in the BPM purchase proposalemulating the messages sent by the ECB. “Thanks to the work done over the last three years,” the time he has been at the Italian bank, “Unicredit is now well positioned to respond to that challenge.”
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