The shock replacement of 70-year-old Sáenz by internal candidate Javier Marín comes just two weeks after the Bank of Spain ordered a review into whether or not he would meet new rules governing bank executives with criminal convictions. Sáenz was convicted in 2009, and handed a three-month suspended jail sentence, for deliberately making false allegations against four businessman who owed money to his previous bank, Banesto.
The businessmen were remanded in jail in 1993, but later proved their innocence. Sixteen years later they won a case against Sáenz. Under Spain's banking rules at the time, the sentence automatically meant he would have been declared unfit to run a bank as soon as the appeal process ran out.
The court declared that Sáenz "knew the allegations were false, including those in later versions of the writ". The Socialist government of José Luis Rodríguez Zapatero tried to pardon him, stating that this also included wiping out his criminal record, thus allowing him to continue at Santander. But that was struck out by the supreme court, which declared that governments could not wipe a criminal record.
On 12 April, the current conservative government of Mariano Rajoy changed the law to ensure that those with criminal records were not automatically banned from senior bank jobs. However, the law left the decision with the Bank of Spain on Sáenz's credentials and opened a new formal inquiry a few days later. A decision had been expected in May.
The government said the new law was meant to reflect European Banking Authority guidelines, which nevertheless state that "criminal or relevant administrative records should be taken into account".
Santander sources at the time said that Sáenz remained energetic and hard-working, so his resignation seemed unlikely to have anything to do with his health. He takes away an €88m (£74.2m) pension pot.
El País on Monday reported that the finance ministry had been opposed to allowing Sáenz to continue at the bank.
Santander has quadrupled in size since Sáenz took over as CEO in 2002, expanding into Britain by buying Abbey National, Alliance & Leicester and much of Bradford & Bingley, rebranding them with the Santander name.
"The board of directors expressed its recognition of and gratitude for Alfredo Sáenz's extraordinary achievements," a company press release stated.
Sáenz's role as chief executive is more akin to that of a chief operating officer – Emilo Botin remains executive chairman of Santander. His daughter Ana Botin runs the UK arm of Santander. Santander wants to float off the UK arm but the move has been delayed until next year at the earliest.
Marín, 46, was CEO of Banif in Spain until 2007, when he joined Santander.
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