Awards for Excellence 2017
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| Full results |
The best bank transformation of the year award goes to Santander Brasil.
Mario Leao, head of the bank’s investment banking division, dates the start of the bank’s turnaround to September 2015 – the date when Sergio Rial became CEO. And 2016 saw the results of changes in leadership, risk management and digital innovation.
The bank is on a charge. Between the first quarters of 2016 and 2017, the bank increased its customers by half-a-million to 3.7 million, increased earned fees by 24.3%, revenues by 16.7%, net income by 37.3% and lowered non-performing loans by 40 basis points to 2.9%. The digital transformation helped lower the bank’s efficiency ratio to 44.9% from 50.3% in just one year – and return on equity leapt to 15.9% from 12.6%.
The bank’s competitors only have words of admiration for Rial. They note the “open channel he enjoys from Madrid” and comment on the fact that “there is no politics at play at the bank – Rial seems intent to make a name for himself, and there doesn’t seem to be anything stopping him.”
Clear leadership is also translating into a happy and motivated bank. For the first time it was included in ‘A Great Place to Work’ – a leading survey of top employers. In a global engagement survey, 93% of its employees said they were “proud to work in the bank”. These statistics matter. In a customer-service environment, the motivation and performance of employees at all levels has an impact on client experience and retention.
As Leao notes, it is not just the retail bank that has been transformed. He joined shortly after Rial assumed the CEO role (after a decade at Morgan Stanley and Goldman Sachs) and Leao says the wholesale bank is also performing better.
“Since Sergio took the helm as CEO, his leadership has really meant a lot in terms of repositioning the bank,” says Leao. “We have been developing a new credibility and a new team.” Leao says the bank has promoted and recruited internally for the investment bank team where possible and brought in some experienced bankers to supplement the team in certain areas to cover skill gaps.
Personal involvement
However, Rial is also personally involved in the development of the wholesale banking division. One head of a rival investment bank in Brazil says that he knows that Rial calls company CEOs during the selection process for mandates: “I can’t compete with that – the client is going to speak to the head of a whole bank before they speak to me.”
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Sergio Rial, |
Santander’s investment bank has already made great progress. It was always a player in international DCM, but has now added local deal flow and is challenging the locals for market share – a feat it is also pulling off in M&A.
The bank was previously second-rate at ECM, but last year it won the mandate to be lead coordinator on Rumo’s $2.6 billion follow-on. And its 2017 first-quarter volumes have already exceeded those for the whole of 2016. If it maintains this momentum, it will not be long before it is a leading candidate for the country’s best investment bank.
“The new emphasis and energy are starting to show in the results,” says Leao. “I think there is a lot still to come, but we are already repositioning – and competitors and clients feel that. There is still a lot more to capture and we are all very excited about that.”
The analysts, long used to weak post-IPO numbers from Santander Brasil, have begun to realize something special is happening at the bank. Marcello Telles at Credit Suisse says 2017 will be “a defining year in the bank’s history”. If it is to put 2016 in the shade, it will have to be a truly remarkable year.
