UBS executive named CEO of Santander
Orcel’s arrival fuels speculation of deals
ZURICH/LONDON/NEW YORK: Banco San tan der SA, in a surprise move, appointed UBS Group AG investment bank head Andrea Orcel as its new chief executive officer on Tuesday, a decision that reshapes the leadership of two of the region’s biggest lenders.
Switzerland’s biggest bank is filling the vacuum by promoting long-time banker Piero Novelli and equities chief Robert Karofsky as co-heads to replace Orcel. At Santander, Jose Antonio Alvarez will stay on as chairman of Santander Spain and becomes vice chairman of Banco Santander.
The appointment of Orcel renews a link between the investment banker and Santander, having been a confidante of and dealmaker for late chairman Emilio Botin, one of Europe’s most acquisitive bankers in recent decades.
The move to the CEO role also marks Orcel’s steady ascent through Europe’s investment banking ranks and comes as UBS shifts its focus away from investment banking and deals in favour of wealth management
Under Ana Botin, who took over from her father as executive chairman, the Spanish bank has shied away from largescale acquisitions and the announcement may fuel speculation that Orcel may change that as Spain’s economic expansion emboldens the nation’s banks.
“There is a cultural fit between Santander and Andrea Orcel: boldness and relentless appetite for high-profile combinations in the banking sector,” said Gildas Surry, who helps oversee more than €1 billion at Axiom Alternative Investments in London. “Santander could well be willing to play its part, as it has always tried in the past.”
UBS’s two new heads inherit a unit that’s trying to focus on growing its merger and IPO advisory business over the next few years to offset industry-wide headwinds in trading.
UBS scaled back its investment bank after the financial crisis. The lender has cut the amount of capital allocated to the investment bank, focusing on areas such as equities, foreign exchange and advisory services, prompting some analysts to speculate on Orcel’s future.
Novelli will focus primarily on corporate client solutions and Karofsky on investor client services, according to a statement from the bank on Tuesday.
Both will be members of the Zurichbased bank’s group executive board. Novelli rejoined the firm in 2013 and is currently executive chairman of corporate client solutions, while Karofsky is global head of equities.
Orcel had been seeking to recruit dealmakers even as many left for rivals. This summer alone, about a half dozen long-time UBS bankers joined Rothschild i n North America to work for UBS veteran Jimmy Neissa that focused on industries including financial services and technology.
JPMorgan added a top consumer banker, while Bank of America took the head of M&A for the Europe, Middle East and Africa region.
But Orcel’s been able to keep headcount steady. He and his team attracted at least 12 senior-level bankers from JPMorgan, Citigroup and Goldman Sachs in the past six months — including a new Americas co-head of M&A from Deutsche Bank AG.
He’s also promoted handfuls of capital markets dealmakers, helping to revive moral at a time when Hong Kong banned his business from advising on initial public offerings.
“Life is a series of hellos and goodbyes but still this moment is bittersweet,” Orcel said in a memo to staff. “I wouldn’t have left for anything less than a client I have been advising and working with my whole career.”