A brave new world of banking after COVID-19

Marco Rottigni, head of Intesa Sanpaolo’s International Subsidiary Banks Division, brings a message of hope and resilience

Giulia Rhodes

31/07/2020

On January 1, 2020, Marco Rottigni took up a new position as head of Intesa Sanpaolo’s International Subsidiary Banks Division (ISBD). His passport was packed. He planned to visit each of the group’s 11 banks across Central and South-Eastern Europe and beyond – spending time with colleagues, deepening his understanding of the individual businesses and fine-tuning strategies.

And then, he says, “the tsunami hit”.

“The pandemic has been a turning point in every sense: for me, for our colleagues and for our clients,” he says, “touching us professionally and personally.”

Rottigni is from Bergamo, the Italian city at the epicentre of Italy’s COVID-19 battle. “It is hard to explain how deeply this has affected us,” he says simply.

His first concern, as the enormity of the unfolding crisis became apparent, was the health and safety of the division’s 23,000 employees, their families and their clients.

The result was an emergency response of which Rottigni is enormously proud. “Ours is a big responsibility. We needed to get credit to families, to companies, to allow them to weather the storm of the temporary liquidity crises they faced and to protect jobs. We had to act, quickly, to show we care about the things that matter to them and give a message of hope.”

There was also a need to change the way in which the division worked. “Within a month more than 90 per cent of our team – across a wide geographic region – was able to work from home, from a starting point of not more than 30 per cent.”

Six months on, with the new reality still unfolding, he is taking stock. The banking sector and the world have changed. “We are entering the ‘new normal’, where the paradigms will be very different,” he says. “We face a period of huge volatility, with resurgences of the virus too.”

For the bank there will be changes in strategic objectives, internal organisation and operating models and the approach to looking after clients. And those clients will themselves have different needs and expectations.

“It is hard to evaluate fully the impact of COVID-19. It will clearly be far from easy,” Rottigni admits, but he is undaunted. “I am an optimist. I know we were in a good position and I believe we will emerge stronger.”

New crisis, new paths

Rottigni points to past crises – the bursting of the dotcom bubble, the collapse of Lehman Brothers, sovereign debt. “These shocks made us explore new paths. We learnt that everything must carry on. Crises can happen at any time. Creativity and experimentation are needed.”

His confidence is boosted by observing his department at work. “I am struck by the amazing skill and professionalism of our people, the quality of the managers and their vision for the business,” he says.

A key strength is diversity and a focus on inclusion. In the Milan office alone, there are 19 nationalities speaking 15 languages. “We are multi-cultural, multi-faith, we have a good gender split, with many women in management. We champion internal mobility.” This diversity, he believes, shapes not only ISBD, but also the culture of the Intesa Sanpaolo group more widely.

The longstanding experience of individual banks in their own countries, meanwhile, gives real impetus. “It means we can help stimulate the economic and social growth of those countries. We take a bottom-up and top-down, global and local approach.”

Accordingly, Intesa Sanpaolo’s longstanding commitment to local communities remains key. Rottigni highlights Alexbank, the Egyptian subsidiary, where a range of CSR projects now includes Saving Hearts, a three-year collaboration with the Magdi Yacoub Heart Foundation to establish an echocardiography facility in Cairo. This will allow treatment for an extra 12,000 heart patients each year.

"Being close to people’s needs is what matters. When everything is going well, that is easy. We are showing that when things become difficult, we carry on"
Marco Rottigni, head of Intesa Sanpaolo’s International Subsidiary Banks Division

Accelerating digital change

The characteristics of reactivity, flexibility and speed have been thrown into relief and will remain key to the division’s growth.

Commitment to digital transformation – already an objective – is being accelerated to meet the demand for digital processes and remote services. Projects concerning IT platforms, telecoms and digital banking have been boosted. “The need is growing more than proportionally.”

Rottigni cites Agora 2, launched in late 2019, which will consolidate IT services for a multi-channel customer base. “This convergence towards common platforms allows us to reduce costs – which COVID-19 has shown us can rise suddenly – and shorten time to market. Our clients need us to be there in that moment,” he says.

Meanwhile Digical, another priority project, is bringing innovative digital products and services to fruition, helping the group develop its entire financing supply chain. “The capacity of sales in virtual branches will become ever-more important,” he says.

All this must be done in a nuanced way that reflects the differing digital picture across the division’s markets. Where the transformation process is slower – such as in Italy compared to Slovakia, he says – mixed solutions are needed, with targeted assistance. “We might make a service digital but have people managing it remotely and calling clients daily.”

Areas of focus are based on analysis of client needs and will help Intesa Sanpaolo boost its competitive advantage. “We need to be proactive. A client might have 10 needs, but we have to be in a position to understand which one comes first.”

As a result, ISBD is also developing a new service model for SMEs. “This is moving from one based on turnover to one based on client needs. It is through these businesses that we can help the economies of the countries to recover,” he says.

Clients also expect a higher level of protection from the bank in the future, says Rottigni, “not only for their health and financial risks, but also for potential future economic interruptions”.

“A strong position in insurance and wealth management – which we have – will be key,” he believes. The group recently acquired control of health insurance company RBM Assicurazione Salute.

From strength to strength

Ultimately, Rottigni says, his division’s figures showcase its strength. “At the end of 2019, we had total assets of €55 billion, contributed almost 17 per cent to the group net profit and had a cost/income ratio of 49.6 per cent.

“These are significant numbers that show a stable platform, organisation and products, with ample space for development. This can all be used to the advantage of our more than 7 million clients.”

In addition, Rottigni is in the “exciting” projecting phase – which he looks forward to discussing in due course – for new developments in the opening Chinese market.

There is then much to look forward to. “My DNA is naturally commercial,” he says. “My previous role, as chief lending officer, gave me a holistic perspective on the mechanisms which regulate banking activity. Now I can bring all this together.

“Of course, COVID-19 should be expected to have an impact on the figures, but the second half of 2020 should bring us towards a phase of gradual recovery.”

He wants to share this sense of optimism and resilience. “Being close to people’s needs is what matters. When everything is going well, that is easy. We are showing that when things become difficult, we carry on. My hope is that we have been able to convey to our clients and colleagues the message of, ‘do not worry, we are here for you’.”

Related stories.