The Madrid judges embraced the banker’s thesis that the offer letter sent to Orcel was a “valid contract”
“Unilateral and unjustified” break. The Santander must pay ad Andrea Orcel a compensation of 68 million: 17 million as a signing bonus, 35 million to cover long-term incentives, 5.8 million for two years of the target remuneration and 10 million for moral and reputational damages. The one against which the first Spanish bank, one of the largest European banks chaired by Ana Botin is willing to appeal, it is a heavy sentence.
The new CEO of UniCredit, who is still reaping the rewards on the stock exchange and on the market of the appreciation of its industrial plan, had sued the Iberian bank two years ago for “backtracking” on his appointment, announced by the group in September 2018, but followed four months later by a rethinking of the board of directors which deemed unsustainable the payment of the deferred bonus of 35 million that the Italian banker had accrued with Ubs, a bank of which he was a senior executive and that he left to sign with the Spaniards.
Initially, the request of the “Ronaldo of the banksi “, as it is called on the market theinvestment banker, was of 112 million euros, reduced to 76 million after being appointed to UniCredit last April. The Italian banker requested that the contract of 24 September 2018 be declared valid e Santander is sentenced to indemnify him with 17 million in constitution bonus, 35 million for taking long-term incentives, 10 million for moral and reputational damages and the corresponding amount two years of the salary he would receive from Santander.
For Santander, however, the offer letter sent to Orcel was not a “Valid contract”, as it had not been approved by the board of directors or the shareholders’ meeting, while the appointment was still subject to the European Central Bank’s suitability assessment.
In his sentence the magistrate Javier Sánchez Beltrán has though espoused Orcel’s thesis and sentenced Santander to pay compensation of 68 million, considering “evident” that the offer letter dated 24 September 2018 “constitutes a valid and perfect contract”, since it contains the offer of one party, the acceptance of the other, the consequent consent of both on the management of the employment relationship . The judge also used the statements made by Botin on her account in her decision Twitter.
“Andrea Orcel has been appointed CEO of the Santander group with effect from the beginning of 2019 (…). It is a source of great satisfaction that Orcel joins our company as CEO of the group, “he had tweeted the president of the group on 25 September 2018. But Botin had also praised, in an interview with Bloomberg of October 2018, the experience that Orcel would bring to the group while in a promotional video the “changes at the top” were announced with the appointment of the “new CEO of Banco Santander”.
According to the judge, the board of directors actually approved the contract, since from the minutes of the meeting of 25 September 2018 it would appear that the economic offer sent to Orcel had the approval of the Remuneration Committee and that the Board of Directors would have unanimously resolved to appoint him by co-optation as a member of the Board and CEO of the bank, an appointment that should have been ratified at the first general meeting of shareholders and then become effective after the authorization of the ECB.
Moreover, the same “presidenta“In September 2018 he would have informed the nomination committee that both the ECB and the Bank of Spain they had informed informally that they had no objections to the appointment of the Italian banker. Underlining that the offer letter does not contain any reference to the approval of the appointment by the shareholders’ meeting, the judge thus declared the contract of 24 September 2018 valid and finalized, judging the bank’s reversal “unilateral and unjustified”.
Santander: “Strong disagreement on the sentence, we will win the appeal”
The group strongly disagrees with the ruling, a spokesman for the Iberian institute said. “The Santander council – he added – is confident that we will be successful on appeal as already happened for the two criminal charges already examined by the judges in relation to this matter”.
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