SAN Banco Santander SA

By Margot Patrick and Jeannette Neumann 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (September 26, 2018).

Banco Santander SA named UBS Group AG's Andrea Orcel as its new CEO, propelling one of Europe's highest-profile investment bankers to the helm of a global banking giant.

Santander said Mr. Orcel will take over early next year from José Antonio Álvarez, who has been in the job since 2015. Mr. Álvarez will become vice chairman of the Santander group and executive chairman for Santander Spain, the bank said.

The search for a new CEO was sparked after Rodrigo Echenique, who currently holds those two executive roles, announced his retirement in June, a person familiar with the matter said. Mr. Orcel wasn't initially identified as a candidate but he became the obvious choice once considered for the job, the person said.

Mr. Orcel is joining a banking giant he helped to create. For years he was the go-to investment banker for former Santander Chairman Emilio Botín, working on deals such as the Spanish bank's 2004 purchase of Britain's Abbey National PLC and acquisition of ABN Amro NV with two other banks just before the 2008 financial crisis.

"Andrea has worked closely with us for the past two decades, in the development and execution of our strategy, and understands and is aligned with the Santander culture," Santander Chairman Ana Botín said in a statement.

The appointment of Mr. Orcel came as a surprise to analysts and others who watch the bank closely.

People who have worked with him describe him as a demanding leader who isn't always open to criticism but gets the job done. Mr. Orcel couldn't immediately be reached for comment. In a statement he said he is proud and excited to join Santander, calling it a "winning organization" that is embracing change.

Santander is one of the world's largest retail banks, focusing on selling mortgages, consumer loans and bank accounts to hundreds of thousands of customers around the world. Mr. Orcel, by contrast, is a longtime investment banker with no experience managing a retail bank. Santander's investment banking unit is a minor part of its overall banking business.

As a global bank, though, with operations in Brazil, the U.K., the U.S. and elsewhere, the polished Mr. Orcel adds a dose of international experience and cachet to Santander.

Mr. Orcel will join as Santander is due to give a strategy update for the next few years. The bank has sought to cut overall costs while increasing investment in digital banking and automation. Its U.S. business, concentrated in retail and commercial banking in the Northeast, is aiming to grow further by tapping corporate customers who are already Santander clients in other parts of the world.

The Italian-born banker has also had a view into the inner workings of other financial firms, spending 20 years at Merrill Lynch advising banks and other institutions before leaving in 2012 to join UBS as investment bank head in another surprise departure. There, he helped oversee a streamlining of the investment bank, which had ballooned in size through aggressive expansion before the financial crisis hit, and a strategic shift toward wealth management.

Under Mr. Orcel's stewardship, the investment banking unit was able to generate adjusted, pretax profit of 1.5 billion francs ($1.6 billion) in 2017.

Mr. Orcel is Santander's third chief executive since Ms. Botín became executive chairman in 2014, following the death of former Chairman Mr. Botín, her father. She had promoted Mr. Álvarez from Santander's chief financial officer to CEO, with a focus on shoring up the bank's capital levels and expanding in Brazil to offset concerns about Santander's U.K. bank as Britain leaves the European Union.

UBS named a pair of internal executives, Piero Novelli and Robert Karofsky, as co-presidents of the investment bank effective October 1.

Brian Blackstone contributed to this article.

Write to Margot Patrick at margot.patrick@wsj.com and Jeannette Neumann at jeannette.neumann@wsj.com

(END) Dow Jones Newswires

September 26, 2018 02:47 ET (06:47 GMT)

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