UniCredit's CEO fixed the bank — then lost the argument about what to do with it

When Jean Pierre Mustier took over UniCredit in 2016, Italy's largest bank needed a rescue: he delivered one — a €13 billion capital increase, the sale of Pioneer Investments to Amundi and other non-core assets, and a steady reduction of the non-performing loans that had weighed on the balance sheet for a decade. By 2020 the repair was largely done. The argument began over what came next.

Mustier's view was capital discipline and organic growth, and he was cautious about large deals; parts of the board — with the Italian government looking for an exit from the rescued Monte dei Paschi — wanted consolidation, and the question of whether UniCredit's Italian operations should even stay inside the group was on the table. On 24 November 2020 Mustier announced he would not seek renewal of his mandate. The strategy disagreement had become a personnel decision.

The board's search ended on 27 January 2021, when it unanimously designated Andrea Orcel, the investment banker who had designed UniCredit's expansion two decades earlier, as his successor. UniCredit got the dealmaker it had argued for; Mustier left a bank in better shape than he found it, and a demonstration that a successful turnaround does not settle the question of what the company is for — it only postpones it.