Orcel’s ‘dream job’ won’t be without its politics
By his own description, Andrea Orcel isn’t one to just “let things go”.
The hard-charging, kick-boxing Italian banker doesn’t shy away from a fight. When Santander poached him from UBS to name him chief executive of the Spanish bank in 2019, only to withdraw the offer weeks later, Orcel hit back in court for damages totalling €100m. That legal battle is still ongoing.
So it shouldn’t be a surprise that Orcel, a man who runs uphill to cram a notional 60-minute workout into 30 minutes of gruelling intensity, is likely to bring the same tenacity as chief executive of UniCredit — if all goes as expected at the Italian bank’s annual general meeting on Thursday.
It’s a milestone for Orcel, who told allies it was his “dream job”, 23 years after orchestrating the $25bn deal that formed the lender, Italy’s second-largest, when he worked as an M&A banker at Merrill Lynch.
After his falling out with Santander chair Ana Botín left him unemployed for the first time in decades, the departure of Jean Pierre Mustier from UniCredit could not have come at a better time.
The Frenchman’s stance on domestic mergers and acquisitions and his cost-cutting initiatives clashed with UniCredit’s Italian board and its incoming chair, the former Italian finance minister Pier Carlo Padoan.
On top of Padoan’s to-do list is considering a UniCredit takeover of Monte dei Paschi di Siena, the world’s oldest bank, which has been state-owned since it was bailed out in 2016. Italian politicians hope to return MPS to the private sector, and Orcel’s speciality is banking deals.
That’s not to say those transactions are always successful. He famously advised Royal Bank of Scotland on its disastrous €72bn takeover of the Dutch bank ABN Amro in 2007, a deal so bad he apologised for it (it led to the collapse of RBS).
Orcel will need to tread carefully with shareholders, who not only oppose the board’s plan to buy MPS, but have been urged by advisory Glass Lewis to vote against his €7.5m pay package.
Beyond dealmaking, Orcel must find a way to lift UniCredit’s price to book value of 0.32, half that of its domestic competitor Intesa Sanpaolo. And as he hunts to lift profits, he must be careful that any cost-cutting measures don’t land him in the crosshairs of Italy’s powerful banking unions.
But Orcel is a man who has historically done things his way. So his new subordinates, accustomed to a more laissez-faire culture at UniCredit, better gulp down their espressos and prepare for his daily 6am phone calls.