POST Online Media Lite Edition


UniCredit to raise $13.8 billion, cut 14,000 jobs

Staff Writer |
Italy's largest bank, UniCredit, unveiled plans to raise 13 billion euros ($13.8 billion) in the nation's biggest share issue.

Article continues below

UniCredit, the only Italian bank deemed important to the stability of the global financial system, has lost more than half its market value this year, hit by concerns over profitability, bad loans and a weaker balance sheet than major European rivals.

The bank plans to launch the issue in the first quarter of 2017 and use the money to help fund the removal of 17.7 billion euros worth of bad debts from its balance sheet, enabling it to boost its profits and also dividend payouts by 2019.

It would take the bank's core capital ratio to above 12.5 percent in 2019, though UniCredit envisages deep job cuts. It plans to shed 14,000 jobs - or about 11 percent of its staff as of the end of 2015.

Including announced asset sales, the bank will have a third less staff by 2019, compared with the end of last year, as a result of its turnaround plan.

"We are taking decisive actions," Chief Executive Jean Pierre Mustier said.

What to read next

Unicredit in talks to sell Pioneer Global Asset Management
UniCredit shareholders back record 13 billion euros cash call
UniCredit to sell Ukraine business to ABH Holdings