Posted on Dec 10, 2019 2021 at 18:16Updated Dec 10, 2019 2021 at 18:35
The amount has decreased compared to the initial claims. It is nonetheless huge. Spanish justice has ordered the Santander bank to pay 68 million euros to Andrea Orcel for his failed hiring in 2019. A victory for the current Italian boss of UniCredit, who has just presented his strategic plan, and claimed last May , at the opening of the trial, 76 million euros to the bank chaired by Ana Botin. At the start of the case, the sum of 112 million euros had even been advanced by the complainant.
According to the Madrid court hearing the case, Santander made a legally binding job offer in 2018, which justified the payment of compensation once the agreement had been broken.
“The contract was terminated unilaterally and arbitrarily by Banco Santander,” said the court, whose judgment was released on Friday. The situation created by Banco Santander caused Andrea Orcel obvious moral damage ”. “In deep disagreement with the judgment rendered”, the Spanish group announced that it would appeal.
The legal and financial soap opera has held the small world of banking in suspense for more than three years. Santander surprised observers in the fall of 2018 by announcing the recruitment of Andrea Orcel, then boss of the UBS investment bank, to become number two in the group chaired by Ana Botin.
The poaching of the Italian, passed by Merrill Lynch and Goldman Sachs, was supposed to illustrate the new ambitions of the Spanish giant, especially present in retail banking in Spain, the United Kingdom and Latin America. As an investment banker, Andrea Orcel had closely advised Emilio Botin, Ana’s father, in his expansion strategy.
The hiring had finally collapsed for a story of big money. By leaving UBS for Santander, the Italian investment banker expected to pocket 55 million euros: an arrival bonus of 17 million euros, to which must be added 35 million euros of deferred bonus that he should have touch if he had stayed in the Swiss bank. She refused to pay the banker when he was no longer part of the house.
Faced with such demands, Santander preferred to give up in early 2019 the recruitment of its future star banker. Andrea Orcel then sued the bank for breach of contract.
A four page letter
It is the appreciation of the “contract” which had at the time been concluded between the Italian banker and the Spanish group which is today at the heart of the affair. Was the long, four-page letter to Andrea Orcel in September 2018 a binding contract or just an initial offer? The Spanish justice chose the first interpretation, to the chagrin of Santander.
The sum of 68 million euros to be paid breaks down as follows: 17 million for the arrival bonus, 35 million as a buyout clause, 5.8 million for two years’ salary and 10 million for moral damage and damage to reputation.