Santander boss Botin quizzed in court over Orcel CEO offer row By Reuters

By Emma Pinedo and Jesús Aguado

MADRID (Reuters) -Santander boss Ana Botin was quizzed in court on Wednesday over the withdrawal of an offer more than two years ago to make Andrea Orcel chief executive of the Spanish bank.

One of the most public rows over a top banking job ended up in a Madrid court after Santander (MC:) dropped plans to make Orcel, previously the top investment banker at Swiss bank UBS, CEO after a dispute over his multi-million-euro pay package.

Orcel and Botin were both in the front row of the packed hearing on Wednesday, taking place in a conference hall instead of a traditional court room due to COVID-19 protocols and because of intense media interest in the case.

The case revolves around whether a four-page offer letter was a binding job contract or a non-binding initial offer, as argued by Santander. It is expected to be concluded in a day, but a verdict could take weeks or months.

The Santander chairman told the hearing that the letter offering Orcel the CEO role “was not a contract”, and that the bank’s board never approved his final compensation package.

“The buyout figure was not agreed. The maximum figure was set and the board decided to communicate the appointment on the basis that the overall package would be in line with the market. But the board did not approve the buyout figure,” Botin said.

She had earlier greeted Orcel, who has not been called to testify, with a “good morning” before taking her seat four spaces away from her former investment banking adviser.

TRACKING THE ‘RAINMAKER’

Botin had surprised the banking world when she offered Orcel the top job in September 2018, but Santander changed its mind the following January, saying it could not meet his pay demands.

These centred on covering up to 35 million euros of his compensation package from UBS.

“We were negotiating the buyout figure until December, and there were different positions within UBS’s board,” Botin said.

“Santander has a maximum figure approved. At the time we are talking about it the board could not have approved it … It would have been necessary to put it to the shareholders’ meeting,” she added.

Orcel worked on deals for Santander as it built up its presence outside Spain over many years while he was a high-profile “rainmaker” at UBS.

He had initially sought as much as 112 million euros ($137 million) for breach of contract and damage to his career, but sources close to the matter and a court document seen by Reuters on Tuesday showed he had cut his initial claim by tens of millions of euros.

The banker dropped the part of his legal claim that would require the Spanish bank to hire him, because he has since been appointed CEO of Italy’s UniCredit.

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