Banks throughout the eurozone are tightening their vaults. According to a survey conducted by the European Central Bank (ECB), banks are changing their credit standards when making loans to businesses and other enterprises. I.e., their internal guidelines and approval criteria became considerably stricter in Q2 2022. When looking around, they see heightened inflation, a wide-reaching war, and a never-ending pandemic. Thus, they see risk everywhere, and most banks like to avoid high risk at all costs. Thus, when making loans to companies fighting through a tough market, European banks have become understandably more rigorous when choosing upon where to place their bets. This tightening is not exclusive to B2B loans. Banks have also become considerably warier when it comes to residential loans. Banks reported, on balance, a net increase in demand for loans to enterprises in Germany and France, while loan demand remained unchanged according to banks in Italy, and decreased in Spain in the second quarter of 2022. Net demand for housing loans increased in Spain and fell in France, Germany and Italy. Net demand for consumer credit increased in France, Germany and Italy, and fell in Spain. Given the state of European banking, only strong leaders will be able to navigate their organisations through the choppy waters up ahead. That is why Spain’s Santander Bank has been so thrilled to bring a new CEO on board.
Next in Line
In June, the Santander Group’s board of directors announced that Héctor Blas Grisi Checa, the current CEO of Santander Mexico and head of the North American region, will be the CEO of the international bank from January 1 2023. Grisi will report directly to the board, in line with Santander’s new management structure announced on February 24 this year, and all regions, countries and global businesses will report to him.
Grisi will succeed José Antonio Álvarez, who joined the Group in 2002. In 2004, he was appointed CFO and, in 2015, CEO. Under Mr Álvarez’s leadership as CEO, the Group has improved across all business metrics and significantly bolstered its capital. The Group has increased its return on tangible equity (RoTE) from 11% in 2014 to more than 14% in the first quarter of 2022, while the CET1 capital ratio has risen from 8 % to more than 12% in the same period. In these years, revenues have grown by 35% in constant euros, and the bank has added almost 40 million customers, bringing the total number of people and companies it serves to 155 million at the end of March 2022. After the transition period, Álvarez will continue on the board of directors as non-executive vice president.
The Next Voyage
Héctor Grisi has extensive experience and knows the business very well, which makes him the ideal person to lead the Group, according to president Ana Botín. He has a long professional career, with a great focus on the client and a proven ability to lead transformation and connectivity processes between the Group’s markets. Santander bank currently ranks among the top three entities for customer satisfaction in almost all of the bank’s main markets while maintaining an efficiency ratio of 45%, among the best in international banking. Grisi certainly has big shoes to fill, but by all accounts, the man is up for the task.