Of all the executive moves mooted in the corridors and backrooms of European banking, the idea that Andrea Orcel might become chief executive of Santander Group had rarely if ever been mentioned.

That explains the incredulity that greeted news of Orcel’s appointment. But once the shock dies down, does the move make any sense?

For Orcel, it probably does. At his former employer UBS, chief executive Sergio Ermotti shows few signs of wanting to relinquish the reins. In any event Martin Blessing, now global co-head of wealth management and former CEO of Switzerland, having also run Commerzbank in Germany, is probably the favoured successor. 

Orcel has been head of UBS’s investment bank for a number of years now, but the arch-dealmaker and former M&A banker was unlikely to constrain his ambitions to the narrow confines of investment banking for ever. Equally, UBS’s wholesale business was never likely to be an end-point for Orcel: while he did a good job of keeping the firm relevant on a restricted-capital model, even a lean and mean UBS could only ever punch so much above its weight.

Why Santander? It should not be forgotten that Orcel was the favoured dealmaker of Emilio Botin, the late executive chairman of Santander and father of current chairman Ana Botin. Orcel, while at Merrill Lynch, famously cobbled together the bid for ABN Amro that swept it away from Barclays and saw the spoils divided up between Santander, RBS and Fortis. 

While the latter two banks suffered the consequences of the takeover, Botin senior was always absolutely delighted with the deal he got, building scale in his Brazilian business and turning a healthy cheque and immediate 50% profit when flipping Italian bank Antonveneta to Monte dei Paschi di Siena in 2007. 

The suspicion now will naturally be that Orcel has been hired by Ana Botin to lead a new round of consolidation at the bank. Emilio built Santander from a small regional Spanish bank to a leading global financial institution on the back of clever deals – such as Abbey in the UK in 2004 – and healthy dividend payouts to keep investors sweet as they were regularly diluted. 

Since she took over, Ana has made clear efforts to plot her own path. Santander has been notably absent from M&A activity under her watch, with the notable exception of €1 opportunistic purchase of Banco Popular in Spain, boosting its presence in an SME sector that has been key to its growth plans.

Santander, along with France’s BNP Paribas, is generally considered one of only two European banks that could one day provide a genuine global rival to the big US banks. For that, it probably needs to be part of the consolidation set to take place in Europe. No investment banker knows the European banking landscape better than Orcel. It also needs to put up or shut up in the US, where the former Sovereign Bank – now rebranded to Santander – has been a running sore. Should Santander buy more and give the US a real shot, or should it sell and devote resources elsewhere?

However, it would be wrong to assume that Orcel’s appointment is based on his deal-making abilities. He has proven a lot of doubters wrong at UBS. Plenty of former colleagues said he would prove to be a poor manager of a big, complex and challenged business. But while inevitably putting some noses out of joint with his dynamic, restless approach, Orcel outperformed expectations at the Swiss bank. 

Orcel replaces Jose Antonio Alvarez, who moves to become executive vice chairman of Santander Group. One of Alvarez’s big achievements has been to transition Santander from the Parthenon IT system that was the bedrock of much of the bank’s success to a new, more modern one. A former CFO, Alvarez is part of the fabric at Santander, trusted by two generations of Botins, but perhaps not the energetic, visionary leader that the bank needs now. 

Or that should read deputy leader. Because the real power at Santander lies in the executive chairman’s role, and Ana Botin remains firmly in charge. Steely and ambitious, how will her relationship with Orcel pan out? They may know each other well, but it’s a different matter entirely to be leader and deputy, rather than client and advisor. 

Ana Botin said of the appointment: “Andrea has worked closely with us for the past two decades, in the development and strategy, and understands and is aligned with the Santander culture.”

Botin took over as executive chairman in 2015. Her first three-year plan shortly comes to an end, and Santander has hit most of its targets. What targets and strategy will be set for the next three years? That will be at the top of her and Orcel’s agenda. The rest of European banking will watch with interest.