The Ronaldo of banking set to strike at Germany’s financial heart

As the grey-haired, sharp-suited Italian strode into the packed conference room in London last week, the audience quickly fell to a hush. The hundreds of delegates at the Bank of America CEO conference in Marylebone knew that this tall, perma-tanned banker was the star attraction.
Andrea Orcel, 61, spent 25 years in London advising chief executives on some of their biggest mergers and acquisitions. During a glittering career he won a reputation for bumper pay packets that helped him earn the sobriquet of “the Ronaldo of banking”.
He is now the boss of a bank himself, and is orchestrating an audacious deal of his own that looks likely to become the defining moment of his career.
Deploying the Anglo Saxon practices he honed in London on the more patrician eurozone, Orcel has created a major political schism inside the European Union, exposed Germany’s economic weakness, and tested the bloc’s appetite for further financial integration.
Why? UniCredit, the Italian bank he has run since 2021, has amassed a 21 per cent stake in its German rival Commerzbank, which is seem by many as a view to a potential merger.
Germany is furious. Its chancellor, Olaf Schloz, branded UniCredit’s lunge an “unfriendly attack”. It serves as an uncomfortable reminder that Germany’s economy is no longer the manufacturing powerhouse it was. Indeed, that a bank from Italy, traditionally the sick man of Europe, has its sights set on one of Germany’s biggest banks, is regarded by some as a humiliation to the eurozone’s biggest economy.
David Marsh, a long-standing watcher of European banking, described Orcel’s move as a “watershed moment” for Germany and Europe. “It adds to the spate of political and economic worries assailing Europe’s biggest economy,” said Marsh, who chairs the banking think tank Omfif.
For Orcel, it stands to be a major test of his deal-making skills, which have already stirred controversy. Everyone in the City seems to have a story about this jet-set banker who is often pictured in a bright red gilet typical of a regular Davos delegate. To some he is a villain, others a hero — and there are warnings of his explosive temper — although others put this down to his passion for his work.
“He’s absolutely brilliant. He excels at everything he turns his hand to. He can, occasionally, lose his temper — that’s probably what people know him for,” said a banker who used to work with him.
Born in Rome to a French mother and an Italian father, after studies at the Sapienza University of Rome and the Insead business school in France, he had short stints as Goldman Sachs and Boston Consulting before joining Merrill Lynch in 1992. He relocated to London and remained here for almost 25 years, making his home in the bankers’ paradise of Holland Park.
At Merrill, he was close to Emilio Botin, the late Spanish banker, helping him build his Santander empire in Britain through the deal in 2004 to buy Abbey National.
He was said to be the mastermind of the unprecedented £49 billion three-way takeover of the ailing Dutch bank ABN Amro in 2007, which at the time was regarded as the deal of the century — until it unravelled spectacularly barely a year later. Royal Bank of Scotland (now NatWest), Belgian insurer Fortis and Spain’s Santander bought the bank and carved it up between them. But it proved a disaster, driving both RBS and Fortis to the brink of collapse. Santander escaped disaster only by the skin of its teeth, by selling on the bit it had bought to Banca Monte dei Paschi di Siena, which went on to have problems of its own.
Orcel is said to have received a $32 million bonus that year, just as Merrill was itself being rescued by Bank of America. He later admitted he would not have advised RBS, then led by Fred “the Shred” Goodwin, to proceed with the deal “with what we know now”.
In 2012, he started running the investment banking arm of Swiss bank UBS, which had been bailed out by Switzerland. Davide Serra, a fellow Italian who runs the asset management firm Algebris Investments, credited Orcel with preventing UBS from collapsing entirely. “UBS was saved partly because Andrea turned around the investment bank,” said Serra.
Orcel had his eye on the group chief executive job at UBS but quit in 2018 to join Santander, chaired by Ana Botin, Emilio’s daughter, as CEO. The move ended in calamity: both sides fell out over his demands for a pay deal of more than €60 million, which proved unpalatable to the Spanish bank. Orcel took the bank to court, which ordered Santander to pay him €43.4 million. Santander is contesting the settlement in the Spanish courts.
In 2021, Orcel took on a job in his native country running UniCredit. He now divides his time between Milan and Portugal, from where his wife, Clara, hails. While he has been credited with turning the bank around — axing 10,000 jobs along the way — he has faced criticism for being slow to pull the bank out of Russia. UniCredit insists that it is conducting an “orderly scaling down” of its presence there.
As a linguist who speaks Italian, French, English and Spanish fluently, German is one language Orcel has not mastered, but one in which he could leave his biggest legacy; his attempt to buy Commerzbank is a major test of whether the eurozone’s vaunted desire to be a single, unified market is anything more than a facade.
Marco Nicolai, Milan-based banks analyst at Jefferies, said: “If German politicians oppose it, it could set a precedent that makes it difficult for politicians in other countries to accept similar cross-border deals. Essentially, this is a pivotal moment for the future of European integration.”
In theory, the merger would improve European banks’ chances of ever going toe-to-toe with their American rivals.
While the eurozone has major banking players such as Deutsche Bank, Santander and BNP Paribas of France, none match the scale of those in the US. JP Morgan alone has a stock market value equivalent to the 12 biggest eurozone banks combined. Even if Unicredit took over Commerzbank, its stock market value would be just 15 per cent of that of JP Morgan.
While Commerzbank and Deutsche have an international profile, the country’s banking sector is generally extremely fragmented. Its famed Mittelstand — the small business sector — is served by scores of local lenders.
Adding to the audacity of Orcel’s swoop is the way he has gone about it. Unicredit first bought a 4.5 per cent stake in Commerzbank during the summer — below the level at which it needs to be disclosed. It then bought 4.5 per cent off the German government.
Last week, UniCredit stunned the markets by admitting it had bought another 11.5 per cent through a complex derivatives trade. This means it does not own the underlying shares but has a right to them. Using this option meant that Unicredit did not have to get approval from the European Central Bank, which is required when an investor takes a stake above 10 per cent in an EU bank.
Now that Orcel holds a strong position, what does he plan to do with it? At that meeting at the Landmark Hotel in London last week, Orcel spelt out his three options for the Commerzbank stake: hold on to it as an investment; find a way to “come together” in a takeover; or sell it off.
Orcel said a deal could be “good for Germany and a test case for Europe, demonstrating whether we can come together and create a stronger bank that can support the economy and the growth that needs to accelerate in our bloc”.
After talks on Friday with Commerzbank, it seems that no formal offer was tabled, with his aim remaining a distant hope.