Angel Ron has sat at the helm of the struggling bank for more than a decade, but his leadership, include poor progress in ditching the lender's toxic assets, has recently sparked grumbles from investors.
The board also announced that it planned to replace Ron with Emilio Saracho, currently a vice chairman at JP Morgan Chase, and it is intended for him start his new role by the first quarter of next year.
Shares in the bank soared on the news, and closed up 13.7 per cent at €0.94. However, the share price is also more than 70 per cent lower than it was this time last year.
A new chairman on the horizon not the only reason Banco Popular shareholders have to be cheerful. The Spanish media also reported today that the bank could be in talks with BBVA, among others, for a potential merger.
Banco Popular declined to comment on the merger reports. A spokesperson for BBVA said it would not comment on market rumours.