Sáenz steps down as Santander CEO despite Cabinet’s “honorability” decree

Supreme Court partly annulled his pardon for false accusation conviction Former Banesto chief will be replaced by general manager Javier Marín

Outgoing Santander CEO Alfredo Sáenz.
Outgoing Santander CEO Alfredo Sáenz.EFE

Alfredo Sáenz has stood down on a “voluntary” basis as chief executive officer and vice president of Banco Santander, Spain’s biggest lender, and will be replaced by the current general manager, Javier Marín, the bank said in statement filed Monday with the National Securities Commission (CNMV).

The move follows the approval by the Cabinet earlier this month of a decree that allows bankers with criminal convictions to continue in the profession, a development that theoretically allowed Sáenz to remain in his post.

Sáenz had been sentenced to three months in jail for false accusation, but was later pardoned by the outgoing Socialist administration in late 2011, despite a recommendation by the Supreme Court not to do so. The Supreme Court partially struck down the pardon, leaving Sáenz's conviction on record.

The decree permits convicted bankers to remain in office if they can demonstrate they have maintained their “honorability.” However, the Economy Ministry took a dim view of allowing Sáenz to continue as Santander CEO.

The 70-year-old Sáenz joined Santander in 1994 after its acquisition of Banesto, which he headed until 2002, when he was named CEO and vice president under Chairman Emilio Botín. Since then Santander has almost quadrupled in size, with its assets growing from 358.138 billion euros to 1.25 trillion last year, while funds under management moved from 453.384 billion to 1.39 trillion as the bank consolidated itself as the euro zone’s biggest lender by market capitalization.

His future had been under a cloud after the Supreme Court partially annulled his pardon

Santander praised the “extraordinary” performance of Sáenz as head of the day-to-day running of the bank. However, his future at the bank had been under something of a cloud after the Supreme Court in February partially annulled his pardon granted by the then Socialist government of Prime Minister José Luis Rodríguez Zapatero.

Under the decree passed by the Cabinet in April, it was up to the Bank of Spain to decide whether Sáenz continued to fulfill the criteria of “honorability.” Under the concept of "honorability" previously established by the Bank of Spain, those with criminal records could not be employed as bankers.

Sáenz had pension rights worth 88.17 million euros as of the end of last year, while the bank took out a life insurance policy in favor of the CEO worth 11.1 million.

Born in 1966, Javier Marín joined Santander in 1991. Apart from his duties as general manager, Marín also was responsible for the group’s global insurance, asset management and private banking divisions. Under his management, Santander has signed strategic alliances in the insurance industry with Zurich in Latin America and Aegon in España.

In addition to Marín’s appointment, Santander also named Matías Rodríguez Inciarte, who headed the executive committee for bank risk, as second vice president, while Juan Miguel Villar Mir was appointed as an independent board director.

Other changes include independent director Guillermo de la Dehesa Romero taking over from Manuel Soto as head of the bank’s audit committee. He was also named third vice president. Santander’s board also appointed Tocino Biscarolasaga as a member of its executive committee.

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