October 30, 2020

Booty now says no to Orcel and the funds are left without new … president?

Booty now says no to Orcel and the funds are left without new ... president?


What about the frustrated signing of the Italian Andrea Orcel As the new CEO of Banco Santander -CEO, it will please its president, Ana Botín- sounds like the same old tune as regards the pressures that the entity supports for those who have the capital in their possession and they doubt their governance. I mean the funds, of course. More «vultures» than ever apparently. Blackrock with 4.49% of the capital of the financial institution and Capital Research and Mangement with 3%. And I can imagine that Botín also sounds familiar, once advised conveniently, and very timely, by those who keep her well informed and sheltered -the same, Borja Prado, Jaime Castellanos or Rodrigo Echenique, his right hand, among others- as soon as the "runruneo" becomes more than that and becomes a dangerous attack with nocturnality and treachery. A situation that already suffered in his own flesh but in deferred, because he lived again and again his predecessor in office, his own father, Emilio Botín.

As well. When everyone assumed that the good José Antonio Álvarez he would retire peacefully to make way for Orcel as the new CEO next April, Botín said "no" and backed off. Last Tuesday, January 14, launched a statement to the media and the National Securities Market Commission (CNMV) with the announcement that the signing could not be. It was very expensive, because of the cost that it had to assume (suddenly?): 50 million euros of the deferred remunerations accumulated by the banking executive in his previous position at the Swiss investment bank UBS.

Surprise! How was it possible? Why? With what the search process had cost, "exhaustive" and advised by external professionals, from which emerged several candidates and with all the contractual figures on the table! The unanimously elected council, they said at the time, was, in any case, an old acquaintance of the bank, whom he has regularly advised from operations as far away as the purchase of Britain's Abbey in 2004. An investment banker profile that If there were no major participation of the funds in Santander – which, if they can, they do not stop pressing in that line of business strategy in the future – it was surprising in an entity focused on commercial banking with individuals and companies. At that time, Botín made it clear that it would not imply a change of strategy. Well, that's it! More reason for "other" shareholders of the bank, wayward and critical always with the Clan Botín at the head of Santander (the funds, of course) bet more on Andrea Orcel as new … President? More than certainty, it's intuition …

Orcel has worked for many years advising Emilio Botín, previously (until his sad death in September 2014), and his daughter Ana Botín, later, in their corporate operations and other millionaire movements in the markets. In fact, it's safe to say that you know more about Santander than many at the bank. Precisely the reason why the president had full confidence in the suitability of the signing. The good relations between one entity and another would be closer if possible and the mutual benefit would also be greater.

How difficult it is for me – and not only for me, it is a general clamor in the media and the sector – to believe that everyone, starting with Botín, did not know the reality of the conditions and the cost of his star signing for the position of CEO! More if possible when it passed through the hands of prestigious lawyers and the appointments and remuneration committees that study and sign everything to the millimeter. Although the same in the Santander they trusted – ingenuous if it had been like that -, and based on that future improvement of "labor" relations between both entities after the signing, in which both UBS and Orcel would reach a mutual agreement with respect to those 50 million for the termination of the contract, at no cost to the Spanish bank.

It does not convince me. Neither me nor almost anyone. In short, remember that the Botín family, which has a very small minority stake in the bank, has always directed it de facto for more than a century. And absolutely always the funds, with more capital than anyone, have questioned their governance. And Orcel could (and wanted?) To have changed the tradition. But … they are assumptions …

María Jesús PérezMaría Jesús PérezEditor-in-chiefMaría Jesús Pérez


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