In April 2021, UniCredit announced that Andrea Orcel would be taking over as Group Chief Executive Officer. It was widely applauded as a bold and interesting move, given he would bring a wealth of experience and a considerable global reputation with him.
But who exactly is Andrea Orcel, what has he done in the past, and what are his plans for the future of UniCredit?
A huge name in global banking
Andrea Orcel is in the global premier league of banking professionals. His reputation is built on a strong track record of delivery allied to vision. Born in Italy in 1963, his interest in investment banking was reportedly sparked by a report on mergers and acquisitions that he read while on holiday in the US at the age of 18.
This early passion would stay with him as his later career developed.
The next step was to study economics and commerce at the Sapienza University of Rome. He graduated summa cum laude, and then went on to the prestigious INSEAD business school to study for an MBA.
After he graduated, he moved to Goldman Sachs and the Boston Consulting Group before he joined Merril Lynch in 1992.
It was there that his reputation for dealmaking began to emerge. He acted as an advisor during the merger between Credito Italiano and Unicredito, a $21bn deal that created Italy’s largest bank, and laid the foundations for the 21st century UniCredit that Orcel now heads up.
For the past 20 years, Orcel has led a successful career, establishing himself as a key global expert in mergers and acquisitions.
This includes an advisory role in the $13 billion (€11 billion) merger of Banco Bilbao Vizcaya and Argentaria to create BBVA, Spain’s second-largest bank, and in Santander’s $1.6 billion (€1.45 billion) acquisition of Alliance & Leicester.
In 2011, he moved to UBS where in 2016, he orchestrated the merger of Vodafone’s and Liberty Global’s operations in the Netherlands to create a joint venture in a deal worth $1.1 billion.
In early 2019, his long-standing advisory relationship with Santander led to the Spanish giant appointing him as its Chief Executive Officer. The move was significant, as Orcel was the first non-Spaniard to be given the role.
Hard work and delivery
Orcel’s management style values hard work and delivery.
It’s something he expects of both himself and his employees, and in the past he has moved quickly to make changes when it becomes clear that something is failing. It is this reputation as a dealmaker and administrator that led to his appointment at UniCredit at a key point in its development.
Orcel’s plans for UniCredit
After his appointment at UniCredit, investors were keen to hear about his plans for the banking giant. Would he focus on mergers and acquisitions, or might this be a time for a different approach?
After keeping his counsel for a few months as he undertook a thoroughgoing assessment of the group and how it works, he finally outlined a clear set of goals.
Growth is integral to Orcel’s vision for UniCredit going forward. In his December strategy update, Orcel pledged to generate dividends and buyback for shareholders worth at least 16 billion euros ($18 billion) in the next four years. To do this, he has set a target of 10% growth.
He intends to achieve this by streamlining UniCredit’s operations and cutting out extraneous spending on areas such as external consultancy fees. He also promised to invest in technologies to speed up the group’s digital transformation which should, in time, deliver savings.
Shares in the group climbed by 11 per cent after the announcement, bringing their gain for the previous months to nearly 70 per cent. As Orcel pointed out in interviews, this meant the group performed significantly better than many of their competitors during an extremely challenging time for the sector.
Orcel believes that technology will be key to delivering on his ambitious growth targets. He recognises that the bank needs to invest in technology to help speed up the group’s digital transformation. In time, it’s believed that these technologies will deliver significant savings while enabling the group to deliver a better service to their customers.
Orcel hasn’t ruled out making any deals that he feels could benefit the group going forward, but he insists he’ll apply very strict criteria before making a move.