Unicredit enters vital talks on CEO’S future
MILAN: Unicredit SPA is entering a vital week of talks on the future of chief executive officer Jean Pierre Mustier, with doubts about his future growing after a rift over the potential takeover of troubled rival Banca Monte dei Paschi di Siena SPA.
Discussions on the bank’s strategy and governance – including Mustier’s leadership – are set to continue this week after board members held an unscheduled meeting on Sunday. The informal discussions focused on board renewal ahead of the end of Mustier’s term in April, according to people with knowledge of the matter.
The Milan-based bank’s nomination committee will start a formal process to identify a list of CEO and other board candidates on Dec 2, one day ahead of its next scheduled meeting. The CEO and other positions are up for renewal in the spring.
The surprise talks around Mustier follows a tumultuous year for the Italian lender. Mustier – in common with many other CEOS – has been forced to row back on ambitions because of the coronavirus. He’s clashed with some board members in recent months over his approach to M&A, arguing that the bank should ignore accelerating consolidation in its local market to focus on organic growth.
A Unicredit spokesman declined to comment when contacted by Bloomberg News.
Unicredit slumped 3.9% as of 9:05am local time yesterday, taking this year’s decline to about 33%.
While Mustier has repeatedly said he’s against acquisitions and would prefer to return cash to shareholders, the Italian Treasury is seeking to find a way to persuade Unicredit to take over troubled state-controlled Monte Paschi. The appointment of Pier Carlo Padoan, Italy’s finance minister between 2014 and 2018 and the architect of Paschi’s rescue, as Unicredit’s next chairman was intended to clear the path to a takeover, according to the people.
Mustier is working on an update of the bank’s strategic plan to be announced early next year, as the uncertainty related to the effect of pandemic makes it more difficult for the bank to hit existing targets. Italy – along with Spain – is one of the European markets to see increasing consolidation. Intesa Sanpaolo SPA, Unicredit’s main rival in the country, has consolidated its leadership by buying smaller UBI Banca, while Credit Agricole’s Italian business is offering about Us$875mil to take over Credito Valtellinese SPA.