Andrea Orcel, the ambitious UniCredit chief eyeing his next deal

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In the 1980s, Andrea Orcel wrote his university thesis on hostile takeovers. Nearly four decades later, the ambitious CEO of UniCredit finds himself at the center of one of the largest European banking sagas in years—engaging with the German government in what could be Europe’s first major cross-border banking deal since the financial crisis.

This week, the Milan-based lender increased its share in rival Commerzbank to 21 percent, awaiting approval from the European Central Bank. This move would position UniCredit as the largest shareholder, surpassing the German government. German Chancellor Olaf Scholz has labeled the stake acquisition as “unfriendly” and “hostile,” yet Orcel insists he does not intend to engage in a confrontation with Berlin.

“Andrea isn’t naive; he’s a strategist and is undoubtedly aware of his actions . . . he has a clear roadmap to achieve his objectives . . . we may not know all the details, but he certainly does,” remarks Alessandro Profumo, the former CEO of UniCredit.

Orcel’s frustration has grown due to Berlin’s hesitance to negotiate, as he is not one to take “no” lightly. Rising early for his daily exercise routine, he has been collaborating tirelessly with bankers from Barclays and Bank of America to navigate this situation.

His dedication to his role, paired with his expertise in advising CEOs on complex deals, has earned Orcel, 61, a reputation for being both intelligent and ruthless. “Andrea is pragmatic and eloquent . . . while he demands a lot, he holds himself to the same standards,” asserts Andrew Gazitua, the former chief operating officer of investment banking at Merrill Lynch, where Orcel began his career. He also maintains a down-to-earth demeanor—favoring his first name in a country where many CEOs prefer a more formal approach.

Raised in Rome by a mother who worked for the United Nations and a father from Sicily who owned a small leasing firm, Orcel attended the esteemed Lycée Français Chateaubriand, frequented by children of aristocrats and diplomats. However, during a break from his studies at La Sapienza university in Rome, he discovered his passion for banking.

Following roles at Goldman Sachs and Boston Consulting Group, Orcel joined Merrill Lynch in 1992, where he completed a two-decade span of successful mergers and acquisitions, including the €21 billion merger that formed UniCredit, leading to his nickname as “the Cristiano Ronaldo of bankers.”

“He was exceptionally knowledgeable and consistently accessible, plus he cultivated personal relationships that opened doors to key decision-makers,” recalls Profumo, who led Credito Italiano at the time.

During his career, Orcel, who served as president of UBS Investment Bank from 2014 to 2018, developed friendships with influential figures, including late Santander chair Emilio Botín, whom he counseled on acquisitions that turned Santander into a global banking powerhouse. However, he has also made a number of enemies along the way.

His rapport with the Botín family deteriorated in 2018 when Santander backed out of appointing him as CEO over salary disputes. When Orcel pursued a multimillion-euro lawsuit, many in the finance world considered him reckless. Ultimately, the courts awarded him €43.5 million. “He follows his convictions even if it makes him appear difficult, but he is always responsible for his choices . . . I reluctantly acknowledge that he is often justified,” states a senior banker in London.

One instance where he may have been misguided was during his advisory role regarding the ill-fated acquisition of ABN Amro by RBS in 2007. He once reflected to the FT, “hindsight reveals we should have approached it differently. I cannot help but feel a sense of responsibility for my involvement.”

The transformation of UniCredit under his leadership, with shares soaring nearly 400 percent since his arrival in 2021, stands as his most significant achievement. Securing a deal with Commerzbank would solidify his legacy in Europe’s financial landscape. Nevertheless, German finance minister Christian Lindner informed lawmakers this week that “regarding their style and communication, UniCredit’s actions did not help bolster the government’s trust.”

This isn’t the first time Orcel, who is known for his bluntness, has clashed with governmental entities. In 2021, the government of Mario Draghi in Italy aimed to sell Monte dei Paschi di Siena to UniCredit, but the negotiations fell through, prompting Orcel to withdraw. Following Russia’s invasion of Ukraine in 2022, Orcel also faced conflicts with the ECB concerning UniCredit’s ongoing operations in Russia. “Andrea is no politician; he’s a straightforward man,” observes Davide Serra, the founder of Algebris, a friend and long-term UniCredit investor. “Moral suasion doesn’t work on him . . . this has led some critics to label him as ill-tempered.”

Commerzbank could be worth the challenge. Insiders suggest that Orcel’s ideal scenario would involve merging it with UniCredit’s existing German subsidiary, HVB. At an appropriate valuation, it would be difficult for the Germans to refuse. This time, the Italian government is also supportive of his ambitions.

Orcel may polarize opinions—“he’s like Marmite: people either love him or loathe him,” remarks Amir Hoveyda, who worked with him at Merrill Lynch and UBS. Nonetheless, he has once more managed to reveal vulnerabilities in his competitors. A strategic thinker, his latest maneuver will compel regulators to address the longstanding call for greater EU banking integration. Rivals who have previously doubted whether an Italian bank, even one that is enlarged, can suffice for such a extraordinarily driven executive, may need to continue keeping a watchful eye.

silvia.borrelli@ft.com

This article has been updated to clarify that Orcel served as president of UBS Investment Bank.