* Ana Botin's appointment initially well received
* Seen following her father's strategy at the bank
* Will have to prove herself over European, U.S. growth
By Jesús Aguado and Julien Toyer
MADRID, Sept 11 (Reuters) - Ana Botin's appointment at the head of Santander signals a continuity in strategy at the bank that has pleased analysts and investors, with banking sources expecting her to prove herself by growing the lender through acquisitions and modernising it.
The euro zone's biggest bank named Ana Botin as its new head on Wednesday hours after her father Emilio's sudden death, continuing the family's century-old rule of the Spanish bank despite owning today no more than 2 percent of its shares.
Although major international funds which hold stakes in the bank have in the past showed reluctance to accept the Botins' control, none of them has yet spoken out.
Shares in the lender closed down around 0.6 percent on Thursday, underperforming peers and Spain's main index Ibex , although they are still up 25.6 percent year-to-date.
A senior source at Santander told Reuters the transition had been well prepared and contacts with investors took place over the last months.
"They were not caught by surprise," said the source.
The bank also briefed analysts on Wednesday, and notes to clients at UBS and Oddo Securities among others were strongly positive about Ana Botin's capacity to manage the transition.
Sheila Bair, a member of Santander's board of directors, told Reuters her name had nothing to do with her appointment and nobody was better qualified to run the bank than Ana Botin.
"I don't think her last name has got anything to do with it, it shouldn't qualify her, it shouldn't disqualify her ... It will be seamless, she knows the organisation inside and out, she's committed to it, she's dedicated most of her career to it."
The source at Santander said Ana Botin had her mind focused on keeping the bank on its current tracks.
"Emilio had the reputation of being boring, well she wants just the same for the bank: low risk, focus on retail, strong national units," said the banker.
"She may just press ahead with modernisation plans and make some adjustments internationally."
She is also not planning to replace any senior executives as she has been involved in hiring most of them over the last 20 years and has worked closely with them when leading the Latin American expansion, the Banesto unit or the UK arm, he said.
Yet, while the business outlook has brightened and the succession had been widely flagged and quietly prepared internally and with investors, the new chairwoman still has to provide a vision for the bank.
More immediately, she also faces a tough time getting Santander a high mark in the European Central Bank's industry health check due in October, rebuilding profits after they were more than halved between 2007 and 2013, and listing the UK unit next year as planned.
Her moment of truth, however, may come further down the road if and when she follows in the footsteps of her father in buying competitors to prolong the bank's steady global expansion.
"If Botin was ambitious, Ana Patricia Botin will be even more and I really believe she will want to make a splash with additional buys in Europe and I wouldn't rule out something in Poland," said Enrique Quemada, head of Spanish investment bank OnetoOne Capital Partners.
"At an international level, the next stage is the U.S. Everywhere where Santander operates, it wants to have a significant presence and it still has to grow in the U.S., especially in retail banking."
Santander's U.S. operations accounted for 9 percent of profits in the first half of the year while Poland made up 6 percent, well below the 20 percent of Britain, 19 percent of Brazil or 13 percent of Spain.
A senior Spanish banker who worked closely with Ana Botin said she would face the same challenges as her father: creating value for shareholders and establishing Santander as a winning bank.
Santander was one of few Spanish banks which didn't slash their dividend during the financial crisis and didn't acquire competitors as the number of national banks shrank from 46 to a dozen.
"If they didn't buy anything in Spain during the current crisis it's because they didn't see any potential. Today, the banking map is no longer Spanish but rather European," the banker said on condition of anonymity. (Additional reporting by Douwe Miedema in New York; Editing by Mark Potter)