MADRID (Reuters) - Santander (>> Banco Santander, S.A.) chief Ana Botin overhauled the management of the euro zone's biggest bank (>> Banco Santander, S.A.) on Tuesday, turning the page after her late father's 28-year leadership and giving the Spanish lender a younger, more international profile.

The bank ousted CEO Javier Marin and replaced him with finance boss Jose Antonio Alvarez, a move welcomed by investors as a sign that Botin, 54, was putting her stamp on a business emerging from a long economic downturn at home.

The new team, which starts on Jan. 1, needs to show Santander can cut costs and build up capital while turning around its business in major markets such as Brazil and Europe, as well as expanding in newer ones such as the United States and Eastern Europe.

The overhaul aims partly to answer big international investors' concerns that Santander's board was not independent enough. Santander replaced two directors and added a third, filling a void left by the death of former chairman Emilio Botin in September, when he was succeeded by his daughter.

In an internal memo seen by Reuters, Ana Botin told staff that she wanted the modernised lender to be "a simple, personal and transparent bank".

A veteran of Santander herself, she has shown every sign of wanting to further her father's strategy, including the bank's global footprint and generous dividend policy. But she has broken with some aspects of his management after four years running the bank's British business.

Whereas the average age of board members had been 65 before the overhaul, the new directors are between 48 and 54 and include Briton Bruce Carnegie-Brown, who had been a front-runner to become chairman of the British division.

He will be lead independent director, a new position meant to foster accountability and which some banks are creating following the financial crisis.

"The changes at Santander are a clear message from Ana Patricia to say 'I'm in charge' and to show who is holding the reins. She is implementing change at all levels of the bank," said Enrique Quemada, CEO of investment bank ONEtoONE.

Santander shares closed up 1 percent at 7.161 euros on Tuesday.

MORE TRANSPARENCY?

Santander was transformed from a local lender by Emilio Botin, who took over from his father in 1986. It now operates mainly in 10 countries - from Britain and Brazil to Mexico, Argentina and Poland - and this has helped it to weather Spain's downturn.

Still, investors were recently disappointed by the pace of recovery in its core lending revenue, and the bank has long been under scrutiny over whether it needs to bolster capital levels.

Some analysts welcomed the appointment of Alvarez, who has had a long career in financial management roles, including at Santander's top domestic rival BBVA (>> Banco Bilbao Vizcaya Argentaria S.A.). The 54-year-old had been Santander's CFO for the past 10 years.

"We expect continuity, predictability and potentially more transparency on issues such as capital and strategic priorities (from Alvarez)," Citi bank analysts in a research note.

Javier Marin, a former personal aide of Emilio Botin's, had been a surprise choice last year as the bank's previous CEO because he was little known outside the bank. He launched cost-cutting and a review of how divisions use up capital, and had demoted some veteran executives, but was still seen as old guard.

Marin is entitled to slightly more than 13.5 million euros (10.71 million pounds) if he takes early retirement from Santander, a source at the bank said. He has also accumulated 4.3 million euros in pension payments after more than 20 years at Santander.

CHANGE OF STYLE

Jose Garcia Cantera, until now head of global banking and markets and who had previously been a top manager at Santander's Spanish retail business Banesto under Ana Botin - will replace Alvarez as CFO. Frenchman Jacques Ripoll, formerly of the British business, will run global banking and markets.

Tuesday's shake-up also addresses corporate governance concerns that have often been raised about the bank, which until recently had three Botin family members on the board.

Santander named Sol Daurella, chairwoman of Coca-Cola's bottling and distribution business in Spain, and Mexican businessman Carlos Fernandez Gonzalez as new independent directors. They replace Spaniards Fernando de Asua and Abel Matutes, long-standing appointments under Emilio Botin.

Ana Botin had already shown in recent weeks she was prepared to break with old teams. She disbanded the bank's international advisory board, cutting Santander's ties with Rodrigo Rato, the former International Monetary Fund chief who has been caught up in a court investigation over his time at bailed-out Spanish lender Bankia (>> Bankia SA).

(Additional reporting by Steve Slater in London; Writing by Sarah White and Julien Toyer; Editing by Alessandra Gallonia, Sophie Walker and David Stamp)

By Jesús Aguado and Sonya Dowsett