ABN Amro Chief to Leave Early After Returning Bank to Marketby
Zalm, CEO since 2009, says lender needs longer-term leader
Dutch bank says it’s started searching for his replacement
ABN Amro Group NV Chief Executive Officer Gerrit Zalm will step down in 2017, saying the Dutch lender needs a longer-term leader after he brought the company back to the stock market following its post-bailout reorganization.
The bank said it has started searching for a successor for the 64-year-old executive, whose term was set to expire in May 2018. Zalm, a former Dutch finance minister, took the helm of ABN Amro in the depths of the financial crisis in 2009, and returned the company to market through an initial public offering last year that raised 3.8 billion euros ($4.3 billion). His departure announcement comes a day after he set out plans to cut as many as 1,375 jobs.
Zalm wants to make way for a replacement “who will be able to lead the bank for a longer period of time,” the Amsterdam-based company said in a statement Tuesday, without specifying a departure date. “The supervisory board respects his decision.”
“ABN Amro needs someone who can spur growth, who can further digitize the bank and who can cut costs at the same time,” said Mediobanca SpA analyst Robin van den Broek, who rates the bank neutral.
ABN Amro, which is still 77 percent owned by the Dutch state, slipped 1.2 percent at 12:09 p.m. in Amsterdam trading. The stock is down about 10 percent this year, compared with a 22 percent drop by the Bloomberg Europe Banks and Financial Services Index.
Dutch Finance Minister Jeroen Dijsselbloem praised Zalm for “the excellent manner in which he led the restructuring,” following a 22 billion-euro government bailout in 2008. “With the IPO, the bank has entered a new phase. The coming period is an obvious moment for Gerrit Zalm to hand over the baton,” he said in a statement.
The government plans to continue selling down its holding in the bank, though Dijsselbloem in May signaled that a sale may come after his current term ends in March 2017. Zalm’s decision to step down won’t influence any decision on further stake sales by the government, Huub Hieltjes, a spokesman for NLFI, the Dutch state agency that manages nationalized financial assets, said by phone.
Van den Broek said potential successors may include retail and private banking chief Chris Vogelzang, 53, a 16-year veteran of ABN Amro and a member of its board.
“The Dutch government will look very closely alongside the bank in their search for a successor, especially when it comes to remuneration,” Van den Broek said. “They probably want to avoid any negative headlines.”
The bank plans 200 million euros of cost cuts as increasing competition, regulatory pressures and low interest rates have hurt earnings since the firm returned to the stock market. ABN Amro is seeking to lower its cost-to-income ratio to 56 percent from 60 percent by the end of 2017 through job cuts and new technology.