Purpose Day 2025 - Andrea Orcel Interview

Let me give you another example. European families currently have 30 to 35 percent of their wealth in bank deposits and cash equivalents. The United States has 10 percent. American investments are 300 percent of GDP, European investments are 98 percent, and British are 150 percent. Another important issue: our 98 percent isn't invested in European companies — it's invested in American companies. Why? Because European companies don't have capital markets, there's no liquidity, so not only are we stuck in deposits instead of productive instruments, but we further fuel America's growth. If we don't move toward a unified European capital market and stronger banks, we won't succeed with any project. First there must be the project, but second there must be the fuel to finance it, and there isn't enough fuel. Right now everyone talks about Germany because they found 1,000 billion to invest, but they don't have another 2,000. Other European countries can't afford to do this. This is a very important issue that combines with true European integration — which doesn't mean giving up our differences. As some of you know, I'm from Rome. I was called to UniCredit, I'm in Milan, and when people say 'Ah, but you're not German, you're Italian,' I tell them, 'Look, I'm from Rome, and like all Romans say, the best thing about Milan is the train to Rome.' I don't need to go to Frankfurt to feel different. All of Europe has very different peculiarities. If you talk to a Bavarian from Munich versus someone from Essen or Frankfurt — two different worlds. The problem is we want to fragment everything at a microscopic level, when instead we should be very proud of our differences and prove we're better. But there are things that define us — defense, infrastructure, energy, financial power — that if we put these engines in common, we can develop everything. This is what I believe, and it's what Draghi, Letta, and so many others continue to say, yet we always find excuses not to do it. No domestic market is large enough to allow a market-leading institution to truly become large. So the border problem remains important to overcome. They're all small. We don't have the balance sheets to do what we're asked to do. Let me give you an example — the only country that perhaps understood this, maybe because it almost went to zero: Greece. When we made our investments in Alpha, from the Prime Minister to the Finance Minister, the central bank, the local society — great positive acclaim. I dined with them, and they asked what this means. First, you're bringing the balance sheet of a bank ten times Alpha's size that can invest in Greece's transformation because I no longer have Alpha's concentration limit. Second, you're investing billions in the country by buying Alpha's shares. Third, you're diversifying Alpha — if something happens, UniCredit takes the remaining risk. They saw it as an influx of capital and strengthening of the capacity to support the country's transformation. But all of us see it completely differently.

I'd say a couple of things. First, I come from investment banking, where they instilled in me that the capital of any institution goes up and down in elevators all day — without that, there's nothing else. We tend to forget this. The difference between a plan and a transformation is execution, and execution is done by people — not the CEO, not management. People are key, and the bigger the organization, the more key they are. On purpose and vision: everyone assumes people are motivated only by promotion, salary, and personal interests. Nothing could be further from the truth. I've seen people accept the cancellation of their bonus — in investment banking, the bonus is 10 to 20 times the salary — and give up promotion, because they believed in the purpose or vision of restructuring that bank, or because they'd always been there and wanted to see it succeed. Even in negative tunnels, if there's light on the other side and people believe in what they're doing, they'll make sacrifices that don't even feel like sacrifices. For us, Unicredit Unlocked lasted 9 months. We interviewed directly, without consultants, 32,000 of 82,000 people, and drew inspiration from them to determine UniCredit's purpose, vision, principles, and values — anchoring them to everything we do. Banking is still contracting in employment. I didn't create this — it's just how it is. In Italy, UniCredit for 15 years didn't hire a single young person, because if the number must go down and you can't get anyone out, you don't hire. In the last two and a half years, we've hired 9,000 young people. We had zero under 35 in Italy; now we have 10 percent, and that 10 percent represents 30 percent of client portfolios. We need a more flexible labor market, but even with this labor market, results are possible through reskilling. We created a university from scratch — 2 million hours of training last year for our 69,000 people, 70 percent digital, 30 percent in person. Take AI: a credit file at UniCredit currently takes six weeks — someone goes online for financial data, does research, puts everything into the standard format, gives a preliminary view, and passes it to the risk office. We already have active AI pilots — it takes 22 minutes. Many people spend six weeks on these files. They're prepared people, completely committed to UniCredit, and it's right to find ways to move them into new roles. Most of the upskilling moves people to network roles. In Italy in 2020, we had 18,000 in the network, 9,000 in direct client contact, out of 32,000 total. Today we still have 18,000 in the network, but direct client contact went from 9,000 to 12,000, average age dropped 10 years, and support staff went down to 6,000. A dramatic repositioning done hand in hand with people and unions, because there's a purpose and vision everyone understands. With AI, the people issue returns — but we must turn it from a problem into an opportunity for redeployment. Think about the iPhone: the iPhone 1 to iPhone 17 is 17 years. With AI, that gap is two or three years. We'll have these impacts in a hyper-accelerated way. Everyone talks about it, few do it, but the speed will be very high. If we don't do it, our fintech competitors will, and we'll be totally disintermediated. I absolutely don't believe that if someone has done one thing for part of their career, they can't do another. It's up to the employer to create the foundations for change. Let me leave you with this: when I started in investment banking, I'd go to client meetings, take notes on paper, go to a phone booth with coins, call collect to London. In the evening, I'd receive a fax on rolling acetate sheets that I had to flatten under the mattress before dinner. After dinner, I'd write. I had to bribe the fax clerk because sending 100 pages took all night. Today we laugh, but people doing my job are still there — much more efficient, much faster. The service went from two weeks to tomorrow morning, but people are still there. Skill sets changed. The problem is transition times are very complex. New generations entering the workforce: easy. Someone 45 or 50: very complicated. This is a social problem we must manage.