Unicredit, a slow waltz waiting for Orcel. But there are many open games, the first is the operation with Mps- Corriere.it

Jean Pierre Mustier
Jean Pierre Mustier

Nyet halfway. The agreement announced last week between Unicredit and Andrea Orcel has not yet resolved theimpasse where the bank in Piazza Gae Aulenti has been from the moment of its polite break with the current CEO Jean Pierre Mustier. It was November 30, 2020 when Mustier announced that he would not reapply for the role of head of the company at the next shareholders’ meeting which, on April 15, 2021, will have to renew the top management of the group. It was the first sign of discontinuity by Pier Carlo Padoan, the former Minister of Economy indicated as the replacement of Cesare Bisoni as president of the bank only a few weeks earlier, on 13 October.

A little over eight weeks have passed from the announcement of Mustier’s step backwards to that of the agreement with Orcel. It will take another eleven to see Orcel installed on the 28th floor of the Milanese tower in Piazza Gae Aulenti. Four and a half months of transitional regime that will not increase the hold on the domestic territory of the second bank by presence in Italy.

Unanimit

Pier Carlo Padoan
Pier Carlo Padoan

The long process of selecting the new CEO was impeccable. The assignment to a leading company of head hunter and the work of the Appointments Committee chaired by Stefano Micossi and with Padoan active member led to the identification of Orcel as the ideal candidate. The board of directors on Tuesday 26 January, by unanimous vote, certified the choice. The profile of the manager of international standing. Roman by birth, Andrea Orcel, 57, a man without borders. Sicilian father, French mother, Portuguese wife, a banker brother in Moscow with Vtb, he has a house in London. In Italy he worked on great deals of the past, including the one that gave birth to Unicredit, but always wearing jerseys of foreign teams: Goldman Sachs at the beginning, then for many years the other American bank Merrill Lynch, then the Swiss Ubs. With great technical skills, although a rookie in the role of company manager, he has shown in the past that he can be a ruthless negotiator, a talented investment banker indeed far from the profile that seemed to be in the sights of the bank in the aftermath of Mustier’s announcement. To the point that, more than one among the top manager of Unicredit, wondered if it wasn’t worth it to mend with Mustier.

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On his desk, when he gets there, Orcel will find some hot files. The first concerns Monte dei Paschi di Siena, the bank of which the Ministry of Economy controls 68 per cent. The government of Rome has pledged before the European Union to exit the capital of Mps by the end of 2021. The negotiations with Unicredit have intensified with the arrival of Padoan and several times in recent weeks an agreement seemed to be approaching. Now it will have to be postponed to at least the second half of April.

Andrea Orcel
Andrea Orcel

A wait that cools expectations, but does not compromise anything. Also because the fame preceding Orcel’s arrival legitimizes the most diverse scenarios. In difficulty on the Italian territory due to the lack of interest shown over the last few years in favor of Intesa Sanpaolo, Unicredit with Orcel could try to recover through external lines. Not only Monte dei Paschi, an agreement with Banco Bpm could also emerge on the horizon, which the minority shareholder of Piazza Meda Davide Leone and the director expressed by him, Alberto Manenti, would very much like. But even the condition in which Unicredit finds itself, with an excess of capital well beyond the regulatory limit, also authorizes the hypothesis of cross-border transactions. A competitor of continental importance, in the light of the multiples expressed by Unicredit and with that available capital, it could think of a merger operation to be carried out practically at no cost.

Orcel will be called to give depth to Unicredit’s action. Above all, after the cuts and divestments of the Mustier management, he will have to act on the revenue front. This is not an easy task, because in the meantime the product factories have sold out.

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Territories

Stefano Micossi
Stefano Micossi

Attention to the Italian territory should also be one of the priorities of the new director, albeit the bank

retail has never been among his professional interests. Certainly the next eleven weeks of Unicredit still appear to be highly complex. The closest deadline is Wednesday 10 February, when the board will approve the final balance sheet for 2020, which will end with a deep red. It will be the last formal act of Jean Pierre Mustier at the helm of Unicredit. The French banker could then step aside. More voices underline that Unicredit is moving towards the appointment of a general manager ad interim, to whom to entrust the ordinary management powers of the bank in the two months from the approval of the financial statements to the shareholders’ meeting in mid-April. An internal appointment, which manages the newspaper and gives Orcel, who has been standing still for three years, time to settle some legal disputes with Santander, the Spanish bank he was joining after leaving UBS and to define with the same Swiss bank $ 50 million in deferred compensation. With regard to the remuneration of Orcel in Unicredit, it will be aligned with market standards and announced at the shareholders’ meeting. Certainly on higher levels than Mustier perceived.

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