Banamex reveals new executive committee


Chloe Hayward
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New management structure is designed to integrate Mexican bank’s activities and shore up management team as Medina Mora moves up Citi global hierarchy.

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Banamex announced the creation of a new executive committee today, whose main goal will be to define, integrate and execute the Mexican bank’s strategy across the entire group. The committee will be headed by Manuel Medina Mora, who was promoted to chief executive officer of Citi consumer banking for the Americas and chairman of Citi’s global consumer council, in January.

The committee will also include three senior executives: Enrique Zorrilla, Javier Arrigunaga and Fernando Quiroz. Together, they have the task of continuing the success story of Medina Mora’s 14-year tenure of the bank.

Zorrilla continues as chief executive of Banamex, the retail and commercial bank.

Arrigunaga has been promoted to chief executive of Grupo Financiero Banamex, the insurance, pension and brokerage operations which include Afore Banamex, Seguros Banamex and Operadora de Sociedades de Inversión. These responsibilities are in addition to his current responsibilities as the chief executive of administration for Citi in Latin America.

Quiroz maintains his position as chief executive for the institutional client group (ICG) of Citi for Latin America and chairman of the board for Accival, the brokerage.

When told of Banamex’s new committee a senior banker in Mexico wasn’t surprised: “Changes at the top of Banamex are long over due,” he said. Apparently wrangling within the banking group has persisted as different areas of the bank have struggled to have their corner heard.

Another senior banker says: “Of course Medina Mora’s move away from Banamex is causing a lot of tensions within the bank and the rest of the businesses within the financial group.... but I see it as nothing more than the internal fighting for power under this new corporate organisation.”

Medina Mora is clearly keeping ties to the Latin business by chairing the new committee as well as retaining the title of chairman and chief executive of Citi Latin America and Mexico. But he will have no daily executive oversight of the bank.

When Medina Mora’s promotion was first announced several sceptics said it was Pandit’s way of trying to keep a potential enemy close. In 2009 rumours circulated that Medina Mora was leading up an effort to buy back Banamex from Citi.

But others were more forgiving. One banker from a competitor bank says: “I don’t think you can portray Medina Mora’s promotion as Pandit having a gun at his head. In fact my understanding is that Pandit actively wanted to promote this Mexican – he’s done a stunning job with Banamex in general I think.”

In fact, Zorrilla is now taking charge of a bank that is on the verge of a new era after an embattled 2009.

During 2009 Mexican authorities put pressure on Citi to sell Banamex because of local laws that prevent a Mexican bank being more than 10% owned by another government. In March the US government injected more than $40 billion and ended up with an effective 36% stake of Citi. Citi owns 100% of Banamex.

In December, Citi struck a deal and repaid $20 billion of the Tarp bailout money it received from the US government. Around the same time Banamex started to release new lending to Mexican clients – both moves have now calmed the Mexican government and make Banamex a secure Citi asset again.

These efforts also reflect Citi’s ambition to put a turbulent year behind it and focus on Latin American opportunities. At Davos, Vikram Pandit, Citi’s chief executive, said that Latin America was his growth priority. On January 29, Citi agreed to spend $513 million exercising an option to buy a further 8.5% stake in LQ Inversiones Financieras, the holding company of Banco de Chile, increasing its stake to 41.5%.

In addition Afore Banamex and Seguros Banamex, a retirement fund administrator and insurance company in Mexico, respectively, were part of Citi Holdings’ brokerage and asset-management segment that set aside assets for sale. Last month chief financial officer at Citi, John Gerspach, said these assets will not now be sold and instead will become part of Citicorp, Citi’s core operations.