Birth of a colossus

Enrico Salza recalls that negotiating the merger meant thinking big

Alastair Smart

30/01/2017

Enrico Salza is an Italian financier who, as president of Gruppo Sanpaolo IMI, was the driving force behind its 2007 merger with Banca Intesa to form Intesa Sanpaolo. He currently serves as chairman and managing director of Tecno Holding SpA

What was the aim in merging Banca Intesa and Sanpaolo IMI?

To transform two medium-sized domestic banks into a global player. Quite simply, we were stronger together than apart. We were too small to compete separately on the world stage. The merger opened up opportunities that would otherwise never have been possible.

The combined entity of Banca Intesa and Sanpaolo IMI stood to control around 20 per cent of Italy’s retail banking – and a strong position in the domestic market also meant freeing up cash flow to focus on the international.
Photo: Enrico Salza, chairman and managing director of Tecno Holding SpA


How much opposition did you encounter at the time?

A fair amount – from certain politicians and shareholders. But I made it clear that even if they put me in front of a firing squad, they’d still never convince me that the merger was a mistake. The combined entity of Banca Intesa and Sanpaolo IMI stood to control around 20 per cent of Italy’s retail banking – and a strong position in the domestic market also meant freeing up cash flow to focus on the international.

Did you realise what a colossus you’d be creating as a result of the merger?

If you mean “were we always thinking big?”, yes. We were aware this was going to be the largest banking merger in Europe for a decade; that our creation, Intesa Sanpaolo, would instantly rank third in the eurozone.

There was a little city-based rivalry initially, perhaps some mutual suspicion, too - Enrico Salza

How much of the opposition you faced was rooted in the traditional rivalry between Turin and Milan as economic powerhouses of northern Italy?

Banca Intesa hailed from Milan and Sanpaolo IMI from Turin, and there was certainly a little city-based rivalry initially, perhaps some mutual suspicion, too. But it was never a case of Turin versus Milan. It was always a case of Turin and Milan. Both cities stood to benefit massively from the merger. From my point of view, as a proud son of Turin, I believed it was a great move for my hometown. It wasn’t a question, as some suggested, of relinquishing power to Milan; it was a way of saving the city from the isolation that would have been its destiny otherwise.

How important was your relationship with Giovanni Bazoli in all this?

Very important. It helped that we’d known each other previously. There was a personal rapport between us and a knowledge, on my part, that here was a man I could trust. That was crucial throughout a process which wasn’t always straightforward and threw various obstacles our way.

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