Run Toward the Hard Problems: Commerzbank CEO Bettina Orlopp

0:00A CNBC original podcast. After 19 years at McKinsey, Bettina Orlopp made the biggest career decision of her life. She left one of the world's leading consulting firms to join Commerzbank, one of Germany's most important lenders, but an institution facing deep questions about its future. Why are you going to Commerzbank? I mean, such a crisis bank. Not long after joining, Orlopp was asked to take on compliance. One senior colleague told her the culture could not be changed. He just told me, this bank, you can't change the compliance culture. It's mission impossible. Orlop took on the problem anyway.

0:36I always thought that you can solve it. That belief would shape a rise from transforming compliance to becoming CFO during COVID to stepping into the CEO role as Unicredit, the pan-European banking group led by Andrea Orchell, built its position in Commerzbank. It was very clear that it would not change my decision. I really feel responsible for the bank, for its stakeholders. For Orlop, leadership isn't about solving hard problems alone. It's about bringing the right people together to tackle them. You can only achieve that if you have a good team around you. These are Bettina Orlop's executive decisions.

1:16How would you describe yourself if someone asked, who are you? That's an interesting question to get in self-description. so I would say I'm very friendly very family oriented family is the most important thing I have I'm always very supportive I'm very direct very direct and you I don't play games I play card games but I don't play games and business so I'm very straight so you always know what you have when you talk to me. I'm glad you're direct and I hope I don't ask too many stupid questions today. And so I see that directness directed at me. But how is that directness and those qualities about being family oriented and being very straightforward?

2:06And I'm going to add calm, if I may, to that as well. That's something that really comes across in our interviews and other pieces I've seen about you. How has that equipped you? I have seen so many different things. and you know that even if something happens, there will be a world the day after. And I think that it makes you calm when things like happening as we have in the moment with our situation and the takeover. I wasn't calm as a young man. No doubt about it. I probably wasn't calm in my first decade at CNBC. I've learned to be calmer. Were you always calm though? Well, first of all, I was always rather quiet.

2:49I know that the first feedbacks in my McKinsey statements was always, she needs to get out of herself, she needs to be a little bit more outspoken. So I was never this person going out there and being on stage and being a star, but it's really rather this quietness. And I always thought that I will win the people with my arguments instead of making a show. So McKinsey, huge American company. You joined in 1995. I would imagine that your calm assurance and quiet professionalism actually sometimes came up against a lot of people who were loud, a bit like me, who were more forceful with their views, who tried to dominate conversations as well.

3:37Did you find that difficult? There was not a lot of females at McKinsey. By the time I joined, I think we were like less than 10%. And if you then do a good job, you don't need to be loud because you're still seen. That was, I think, if you're a quiet man, it would be much more difficult. But a quiet, smart woman has a privilege to be seen. That's really interesting. And I've spoken to a lot of amazing female CEOs in this series as well. And I've talked to them about sexism. and one said to me early on in her career she didn't have any it was only when she got to the top that she found this sexism have you had instances that you can recall where actually you've had overt sexism where you've had to face it down or deal with the consequences very few once twice i had once when i was a young what was it what was it i was even not a project manager i think i was an analyst and someone was calling me i even don't know what the what the word in english is it's like um darling um but not very nice yeah and he didn't like what i said um but i i stopped basically the discussion it was a very big round and i said well you know i i didn't understand you and this was at mckinsey or comments um it was at mckinsey um i was very young um and um it was at a client big group of people and i just stopped the meeting i said we can't we can't continue the meeting and then I let the partner handle it so I didn't let it go so I really had consequences and stuff like that.

5:13How did it feel? I don't know I was very much supported so I went straight to the partner and he basically cleared it pretty quickly. I think that is the most important thing you should not let it happen. Something you told me beforehand which I haven't seen anywhere is that you are a second generation in your family to be at McKinsey. And this brings me to your father, who unfortunately passed very early on in your career. Tell me about the importance of him as a mentor. It was a different relationship between parents and kids, I think, by that time. I think our kids get much more about what we do.

5:50We are much more outspoken with them. They can see it on TV. Yeah, that's also true. So we're treating them differently than probably relations have been earlier times. But clearly, I have seen a lot. I had the privilege also to move around a lot. So that gives me probably a lot of flexibility and resilience. And yes, indeed, I mean, it was not planned that I had an offer by BMW and I had an offer by McKinsey. And then I decided to go to McKinsey. My father even didn't know that I applied for because I knew from my brother that he didn't want us to have the similar past. So I just applied because I thought the program was so interesting.

6:31They had a PhD program by that time that I thought was interesting. And I got the job and then I told him. And yes, and then he died very early, so he never saw what I did. But I was actually the second generation partner with McKinsey. So he was a partner, I was a partner. I presume he was brimming with pride. Well, he was surprised by that time, but he was already very sick when I did it. It also was a reason why I didn't tell him because I thought I surprised him. What qualities did he and other family members, you've already mentioned that family is so important to you. What qualities did your family give you that have stood the test of time and supported you in your life?

7:17He was very relaxed. He was also rather calm, always having a good joke if necessary. but then also very straight and very direct, and that was probably helpful as a role model. You've mentioned already, a place like McKinsey, they get their power to flesh. My word's not yours. They like the long hours as well. Did you fear that that would blight your career? Well, actually, if I would say that what was my most difficult part in my career, it was probably the part when I had kids and I was with McKinsey because it was not so easy and it was a completely different way of working than we have today.

7:59There was no mobile working, no possibility to join via a video conference and stuff like that. It was physical presence at any moment in time. So it was very difficult and it was also much less accepted that you would say that I stay at home because kids are sick. I remember very well once I had my kids were sick, my nanny was sick, my husband was on a business trip, so I couldn't make it to the office. And it was a really big and important meeting. And I wrote to my partner colleagues and I said, listen, I can't come because kids are sick, nanny is sick. Nobody wrote back. Nobody cared about things.

8:46the whole discussion went on without me and I was totally frustrated and then my husband came home in the evening and I talked about that with him and I said you know I mean I'm so frustrated they could write okay shall we we take care and we let you know we debrief you after the meeting nothing and he looked at me and said I mean you're so stupid everybody else would have said I'm sick then that would have happened and that's true. I would have been angry and frustrated I think had I been in your position were you I was I was um but um this is um how the world was by that time but I have to say that that was something so different um when when I joined Comments Bank because I was also able to to to come back 100 percent and I'm a big fan of working part-time and you need to feel the flexibility but I would always say and I always recommend and urge younger woman to just return pretty quickly to 100%.

9:51That amazing 19-year career at McKinsey gave you so many tools for what the last 12 years has given you as a Commerzbank employee and then CFO and then chief executive as well. Tell me about the decision to join Commerzbank. Why did you do that? First of all, I had the feeling that I need to do something different. So it was perfect timing. And it was New Year 2014 when I got an SMS actually from Martin Blessing, the CEO of Comments Bank by the time. And the fun part on it is, and this shows you that life is sometimes really one step or the other step, is that I didn't get his first SMS because my husband gave me as a present for Christmas or something.

10:41He gave me a new mobile phone and he also installed it because I'm not a very technical person. But the problem was we went on vacation and my phone didn't work and I didn't get any messages over New Year and things like that. So I was completely out of communication for a week. And then we returned and all messages were lost. Luckily, a friend of mine, who is also a friend to Martin Blessing, wrote me on the 4th of January and said, Oh, Tina, is everything okay with you? You didn't answer to any of your messages. And I said, well, you know, messages got lost. Sorry for that. And then a second later, I got the second SMS of Martin asking me whether we could have a dialogue.

11:31And then we did. And that's how I joined Comments Bank. And why did I join Comments Bank? Because I really liked the people. So I decided that this would be a good new chapter. And yet it's been an extraordinary 12 years. I'll just whiz through your career. You joined in 2014, head of group development and strategy. 2017, you took responsibility for compliance, legal and HR. 2020, you became the CFO. We'll put on hold the bit where you become the CEO for the moment as well. Throughout that period, Martin Blessing retired in 2016 from the role. Martin Zilka took over 2016 to 2020. Thereafter, Manfred Knoff, 2021 to 2024.

12:15It was a period fraught with crisis after crisis. how were you coping with all of these oscillations martin had got the bank through the gfc through the great financial crisis but it was one crisis after another it seems up until you became ceo it looks to me well um yeah i mean when i when i joined 2014 i remember very well because i also had an offer um from from from someone else and and my colleague were asking why are you going to comets bank. I mean, such a crisis bank. And then also when I signed the contract, there was a press full of headlines that Martin might be forced to step down and stuff like that.

13:02That was all these things going on. And I said, well, I do it and I like it. And I was self-confident enough to say, if this doesn't work, I just do something else. There will be plenty of opportunities for me out there. But you said you had a great couple of years, but the crisis ensued. And I'll start at 2017. Cerberus have a 5 % stake. And by 2019, the stock has fallen 60%. And then they write the most scathing set of comments about Commerzbank to Stefan Schmidtman. Swift and decisive action is needed now, required to stop a downward spiral. So you've been there already at this point. five years and one of the biggest shareholders, apart from the German government, thinks you're in a downward spiral.

13:51The management's ill-conceived and poorly executed attempts to prevent Commerz Banks' demise display a level of negligence and arrogance we are no longer willing to tolerate. They say you're unambitious and you're part of that team. So, okay, this is the epicenter of the crisis. The shares have fallen aggressively. You are rising up the ladder and then you become part of the solution because you take on that CFO role. Tell me about that period. Yeah, I mean, just a little anecdote, which is probably defining a little bit what I have experienced with Comments Bank. When I took over the role, the first board role, being also responsible for compliance, I had the head of compliance who would have been my direct report.

14:36But he canceled his contract three days before I got announced. And then I called him up. It was on a Sunday I got announced. So I called him up on Monday and said, listen, I mean, I would be now your new boss. Don't you think we could do that jointly and just do it differently? Because the whole compliance program was a mess by that time. And he didn't. It wasn't there for a long time. And he just told me, you know, Bettina, I really appreciate and I like you, but I think this bank, you can't change the compliance culture. It's submission impossible. And I said, oh, that's great that I accepted this job and someone is telling me this is submission impossible.

15:21But I didn't give up. Bettina, you knew a lot of these crises. You didn't need the head of compliance to tell you things were tough. The shares are through the floor. Cerberus are angry. The merger talks as well. Christian Saving thinking there was a solution. The German government, Berlin pushing as well. There were so many crises. You've just added in COVID as well. Bettina, you knew all of this and you took that role. Because I always thought that you can solve it. And I did. I did solve the compliance topic and I never did it alone. I also always believe that you can only achieve that if you have a good team around you.

15:56Then in the summer 2020, we developed this new strategy, strategy 2024, which I think was really an important basis of what you now see of Comets Bank. Because at that time, we just decided to forget about everything we have seen so far. Let's assume the world stays as difficult as it is. Negative interest rate in YM, no margin improvement, competition like hell. And let's assume that we want to have a bank which has decent profitability despite all this. What do we have to do? And we did that. It was really painful, but we did it. And the results you can even see today.

16:45Before we continue, a quick note on timing. We recorded this conversation with Bettina Orlop in May 2026. Since then, Unicredit's takeover offer for Commerzbank has moved on significantly. The acceptance period has closed and Unicredit has announced final tender results, saying its direct holding, tender chairs and related instruments would give it access to close to half of Comets Bank's voting rights. So as you watch this next section, it's worth remembering that Bettina's comments reflect where things stood at the time of our interview, before the offer period had concluded. With that context, here's our discussion about Unicredit, Comets Bank's transformation and what it's been like for Orlop to lead the bank through the period.

17:26So you become the CEO. 2024, Manfred Knopf resigns. You are part of the solution. You take on that role. You know a man who loves the battle, Andrea Orchell, is hovering. He's prodding. He's probing. He's picking up a stake. He's got his derivative positions as well. You have quite an adversary there. Tell me about how you felt when you took on that role with all those other crises, hopefully behind you, but the transformation midstream still. And then you've got Andrea Orchell just champing at the bit to take over. Comments. Well, first of all, I mean, it's not that the decision of me being CEO just happened within three days in September.

18:11There was clearly a debate over summer whether this could be a good idea or not a good idea, very much also dependent on what would Manfred Knoff decide together with the supervisory board and stuff like that. but it's not something which happened overnight. So I've put some thoughts into it. Sorry, just let me interrupt. You knew there was a distinct possibility, given the work you'd done on strategy already, that you would be the next CEO. There was a possibility, exactly. And it was also very clear for me at this certain point in time that I would love to have once this kind of role because I thought it's a good role also for me.

18:48So that was not a surprise. So it was not a decision of two days of something like that. Situation then definitely changed on this day of the 11th of September when we learned that Unicredit took a stake. But it was very clear that that would not change my decision because I really feel responsible for the bank, for its stakeholders. And I like the bank very much, which helps, I think, to like what you do and to like the environment, to like your team, because people feel that you're with them and not against them. Was it quite the opposite rather than, oh, I don't want to take it because of this?

19:28Actually, I want to take it because of this, because I really love the concept of the independence of Commerzbank, which is something that's come up time and time again when I've spoken to you and I've read other interviews as well. You actually relished that opportunity. You wanted to take on Andrea Oceo and Unicredit. Well, what I wanted is to protect the interests of our stakeholders and to create value, because I thought that at that time we were absolutely undervalued. And I knew that already as a CFO, I was really also talking actually to our shareholder, our biggest one by that time, and said, you know, we are in a dangerous phase because we made great progress in our profitability.

20:08but our share price doesn't show it yet entirely. So this is a very, we all know that, that's always a very dangerous situation if everybody sees that you're on the right path but unfortunately valuation doesn't show yet. And that was basically the situation in September and Andrea took the opportunity. I always say I would have probably done exactly the same thing because it was a perfect opportunity. I mean, a stake at a very low price for I think a very good bank probably we have a little bit diverging views on that but I would have acted exactly the same but then I would have done a lot of things very differently and my task is and I always saw that from the beginning on when I started in October I said we we have the basis of really having a great strategy a great value proposition for clients and I want to show it and I want to give our shareholders the opportunity to not give away their shares for not the right value if there's so much value in our bank and I said I want to show it and that's what's driving me and you see now the success of the bank and that's helpful I mean if you would do a lot of things and then you would not see the success and share price would go down, you would be super frustrated.

21:36So we are also on this very positive spiral upwards because whatever we do, it works. You see the results and you see the share price increasing. Look, I remember Comets Bank at its lows. I remember talking on CNBC about, I think it was a 0.3 price to book of Comets Bank. It was one of the lowest in Europe and it was really floundering. Now, you had your internal strategy, but has UnaCredit's pro-action actually done you a favor? It's helped you transform Commerzbank. I mean, it's so hard to say because you don't know. But you probably wouldn't have moved as aggressively without... I don't know.

22:19I mean, I would probably have taken more time. I think what makes the difference is really the speed and how we did develop the strategy because it's very clear if you take over as a CEO people and you also expect to present a new strategy which has your name and and your your signature on it so it was very clear that we would come up with a new strategy also based on what we have seen what came out of strategy 2024 where I was also part of and I think the only difference is that I probably would have taken a little bit more time, like 100 days and talking around, meeting people, making much more stakeholder management than I was able to do because of this triple of having a bank to be run, having a credit situation and having a strategy development.

23:10You normally would not do that. And then being new in your role, and actually the CEO role is different to a CFO role. You get well prepared, but it's different. So you would not do that necessarily. So the difference is really only timing. I know we're getting quite existential and holistic here, but Europe is in crisis. European banks are in crisis. The need to keep European capital at home rather than getting it to fund US tech is a crisis. And I am frustrated as an observer, as a proud European, at how many banks there are in Germany, How many banks there are in Europe? How the capital could stay here and fund this amazing European economy?

23:54Isn't what Andrea Occell offering part of the solution to actually getting Europe where it needs to be? Well, there's a whole debate about pan-European consolidation. And I'm a big fan of pan-European consolidation. But the problem is, without having a banking union, you do not see really benefits of it. You also now see it. Nobody is really talking about pan-European synergies because there are none. It's about partly restructuring, which we think is not necessary, and then integration of two domestic operations. That's what it's all about. And you can also argue that. But I mean, I really can only look on Comments Bank and you ask whether this helped us to move forward quicker.

24:37And clearly, if you really have a crisis and you see that things are necessary, people are moving faster. That's no question. But I think what is also equally important is, and that is probably also a recipe for some of the things we see in governments, you just need to be very open and blunt with the people. And you need to say, this is necessary and it's not easy. You can't have a really good strategy. You can't have a transformation and make it great for everybody. That's not going to work. So you need to tell also what will be different, how people have to change, what you have to let go. And you really need to tell people the truth.

25:24And it's not that you can make it easy and smooth for everybody. It is tough and difficult. And I think you can only move forward if you're prepared to also send these messages. and this is what we did. I mean we have a growth strategy but in parallel we have also transformation. We also are forced to reduce stuff and we will now do it again with our strategy update because this is how the world functions given all the technology developments going on and we have to face reality but we can then create something really good and we create something which is of value for all stakeholders, including staff.

26:11I'll talk about the staff first. I want to talk about other stakeholders as well. But are you moving aggressively enough? I spoke to one shareholder, actually, just before this interview. And he said to me, you could probably go quicker. You could probably be more aggressive, and especially given the technological change as well. And you mentioned earlier on something. You said, I'm not particularly technologically adept as well. But I'm sure you're more aware than I will ever be about the threats to traditional banking from the new players and from AI as well. Actually, Bettina, as great a position as you've got the bank in, and it's a completely different proposition from 2020 and certainly from 2024, and that's much to your credit, do you need to be more aggressive?

26:54I think we are pretty aggressive. And actually, I'm now getting much more technology savvy, but still my phone situation, I let handle someone else. But I mean, I'm also a heavy user of AI tools. I believe in advance of this interview, you may have used a certain language model to just check out the podcast. That's true. That's true. I hope it was accurate. It was pretty accurate. And I use it all the time. I do it on a daily basis. And what I see and what everybody in the bank sees that there is big value and big efficiency gains in there. But as always with technology, you have to be careful because most of the time the short-term effects are overestimated and then the mid-term effects are underestimated.

27:38And this is, I think, the right balance you need to find. And one should not forget we are also, we are banks or We have a lot of regulation. We have a lot of obligations. We have to protect data for our clients. There's consumer protection out there. So we can't move as quickly as you might think of other industries because we always have to be mindful that we keep the environment safe for people but also for our clients. we move very fast specifically when it comes to ai and it's i mean now we talk about a time period under 2030 that's not a lot and that is something which is hard for the people because you you tell them something but then in the same moment you're saying okay but this this is what it is in the moment it might be very different hundreds of thousands more jobs are going to go aren't they not in the industry and people know that i mean they can all read newspapers and and everything So they know that.

28:36And I think this world is changing all the time. So you have also to be very open to and candid with your people and colleagues that what you say today, you might again with you and have a year, a year, and there might be a different outcome. And I think that is important. And then you should move, but you should move in a realistic version. And I think that also is the beauty of the last, I would say, five years when you look at Commerce Bank is that I, as a CFO and now as CEO, I never promised something which I didn't think we couldn't deliver, which is a lot about availability and that you can really rely on what people are saying.

29:22And I think that also does the trick. Are you relishing getting up every day and having these dual challenges? Well, I mean, it's a job I signed up for, right? I mean, I knew that, and I now know it from experience, because there have been never easy times, because it's also part of the rule you have. It's not been easy since 2014. Yeah, but it's never easy. And if you're a leader, every conversation starts with a sentence, we have a problem. We have a crisis. This is, I mean, if you're in a leadership position, that's what's happening. So you have to take that. This may be presumptuous of me, but I think you relish the challenge.

30:06That might be also. I mean, it's never a dull moment to say it like that. But I would love to have some weekends back. In the moment, I don't have a lot of weekends. So I would definitely like to get some of my weekends back. And there was too much cancellations of private events and stuff like that. Everyone has their coping mechanisms. What are yours? But first of all, I have really, really the benefit of having a great team. You can never do things like that alone. Never, never, never. So you always have to have a great team, which is challenging you, which is supporting you, which makes sure that you're not going overboard when you're getting emotional.

30:44So you need to have a question. I can't imagine you getting overboard emotionally. I'm sorry. Sometimes. It just does not appear to be part of your psyche. You will never see that in public, but I have the things how I get over it before I go out. This is personal, but the worries don't answer. I know the family is important to you and your amazing partner and your children as well. But what is it you use? Do you use sport? Do you use literature? Do you use music? Do you use meditation, a combination, good sleep? Everyone's got something. Everyone's got a secret sauce. It's probably a combination.