Italian bank that holds BOV shareholding is in for major restructuring

Unicredit, which holds a 14% stake in Bank of Valletta, is reported to be planning a major restructuring of its business by year’s end

Unicredit is set to announce major restructuring plans by year's end
Unicredit is set to announce major restructuring plans by year's end

Unicredit is set to undergo a major restructuring process that could see it axe up to 10,000 jobs, Bloomberg has reported.

The Italian bank holds a 14% stake in Bank of Valletta, which it inherited after merging with Capitalia in 2007.

Capitalia had acquired the BOV shareholding from Banco di Sicilia, which had been one of the original shareholders in the Maltese bank, alongside the Maltese government.

It is unclear whether Unicredit’s restructuring will also involve the disposal of its BOV shareholding. 

Earlier this year, Unicredit raised about €2.1 billion by selling its holding in Banca Fineco.

Unicredit will be the second major European bank after Deutsche Bank to undergo significant restructuring in a bid to cut operating costs. Deutsche Bank plans to cut 18,000 jobs.

Bloomberg reported today that people familiar with the matter said the Italian lender was weighing plans to cut thousands of jobs, mainly in Italy, and reduce other operating expenses by as much as 10%.

The bank declined to comment.

In an interview last week, Unicredit CEO Jean Pierre Mustier told Milano Finanza the bank’s new business plan will be based on organic growth and will try to simplify the way it does business to enhance efficiency.

An option Unicredit is said to be considering to reduce the cost of funding is the creation of a separate holding company in Germany for its foreign businesses.

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