Santander Reworks CEO, Chair Reporting Lines After ECB Nudge
Santander Reworks CEO, Chair Reporting Lines After ECB Nudge
(Bloomberg) -- Banco Santander SA will change its management structure so that Chief Executive Officer Jose Antonio Alvarez no longer reports to Chairman Ana Botin, in line with recommendations by the European Central Bank.
The board of Spain’s largest bank agreed on the changes at a meeting Thursday, according to a statement. Alvarez will now only report to the board of directors, whereas until now he also answered to Botin.
Botin will remain as executive Chairman and will focus on leading the bank’s strategy, the statement said, adding that the reform was in line with “supervisory expectations.”
“As well as aligning our model to peers, the changes ensure we continue to meet the highest standards of governance with a clear differentiation between the executive chair and CEO roles,” Botin said in the statement.
El Confidencial, which reported the changes earlier, said the ECB wants better balance between chairpersons and CEOs at European banks.
Spain has long been an outlier in the region’s corporate governance, with duties between chair and chief executives often blurred. In general, the Frankfurt-based supervisor has pushed for governance reforms at lenders in the region to improve risk management and decision-making.
Banco Bilbao Vizcaya Argentaria SA, the country’s second-largest bank, changed its structure in December 2018, when it named former CEO Carlos Torres as chairman, and the new CEO, Onur Genc, began by reporting only to the board.
Botin was appointed Santander’s Chairman in 2014, following the death of her father Emilio, and later appointed Alvarez as the bank’s CEO.
The bank also said it will pay a final cash dividend from 2021 results of 5.15 euro cents per share while also completing a further share buyback of approximately 865 million euros ($965 million), subject to necessary approvals. The bank will also complete a further share buyback of approximately 865 million euros, subject to regulatory approvals.
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