Split in Sareb: Board resigned because of the differences with the president, Belén Romana

23/01/14 – El Confidencial.

The time-bomb finally exploded. The Director General, Walter de Luna, and the Director of Financial Assets, Luis Moreno, cannot tolerate the situation anymore. The numbers two and five in the leadership ranking of the “bad bank” will soon leave the company, according to various sources that are aware of this situation. Their departure is due to the significant discrepancies with the president, Belen Romana, that create an unsustainable situation. The entity has to face now a huge image problem, while being in a recovery process of the international funds’ interest in Spain. Also, the large banks present at its board will have to take action on this matter.

The tension between the president, having a marked political role, and company’s number two, being previously in the financial sector, was almost incessant from the beginning, but it peaked last summer as El Confidencial informed. Then, the executive’s intervention managed to calm down things, but it only lasted for some months. Everything has a limit and the close of the financial year created an unbearable situation that led to Walter de Luna’s and Luis Moreno’s departure that preferred to go home instead of being anymore under Romana’s orders. They only kept up appearances till the substitutes were selected in order to avoid a power vacuum.

Walter Luna was appointed by the banks (possessing 51% of Sareb’s capital) as a counterbalance to Belen Romana, a woman with a clear political profile,  who is close friend to the minister Luis de Guindos, and with a strictly financial formation( she was  Director General  of the Treasury along with Rodrigo Rato) but without having a real estate past. The Director General, on the other hand, was contributing with his experience in the market as a historic Real Estate Fund Manger in ING, as well as the rest of the management team he chose to be part of Sareb , like Miguel Caricano, also coming from ING, that stepped out from his position as Sareb’s Process and Reporting Manager in July 2013.

The premature departure of Caricano, only seven months after being incorporated into the company, was just about to break Sareb’s management structure. The existing division could not go on because of Romana’s desire for absolute control who from the beginning was questioning de Luna´s professional decisions and she also turned back some of them. For example, in February she commissioned a new business plan to KPMG instead of the one already prepared by Álvarez & Marshal. Likewise, in June she left the adopted conservative policy and opted for applying bigger discounts to the prices in relation to the already established ones. At the end, the “bad bank” closed its first year with sales up to more than 1.000 million Euros.

More and more, these incidents were making the relationship between Walter de Luna and his team unbearable. In that sense, Caricano’s departure marked a turning point leaving no space for any possible reconciliation. It was then when Romana, after considering it with some of the reference shareholders, decided to start a restricted selection process in order to recruit the new number two of Sareb. This time, however, she herself decided to approve and reassure that her future right hand inside the ” bad bank” will fit in with the profile imposed by her. No wonder, the name of the person selected will be announced soon enough, according to financial sources.

Officially, Sareb keeps this issue under silence procedure. However, sources close to the Management Board reassure that the incompatibility between Romana and de Luna is even obvious in the formal issues of their relationship. “Walter is a very serene person that takes things easy with a long-term perspective whereas Belén is totally the opposite with a strong character, showing no empathy to her or to the Board, prone to give orders and trying to impose her opinion to everybody. In this context, it was only a matter of time for things to get out of control. Apart from their professional differences, the incompatibility of their characters was evident.

Source: El confindencial