The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.
Banking

UniCredit chief resists rush to capital increase for Basle III

UniCredit’s chief executive insists the bank has no immediate need to raise extra capital despite recent cash calls by rival Italian lenders ahead of Europe’s stress tests.

Federico Ghizzoni tells Euromoney that he “doesn’t feel under any pressure to rush” to access the capital markets, emphasizing that the bank already meets Basle III requirements eight years ahead of schedule.

UniCredit’s core tier-1 ratio is 8.58% under current rules. Even if diluted by the new Basle rules, the ratio would still be 7.3%, above the minimum threshold of 7%.

UniCredit, however, lags behind other leading European banks, such as Credit Suisse, HSBC and Barclays, which all have ratios above 10% under the present regime.

Still, Ghizzoni remains confident and believes the bank’s capital position will strengthen with renewed profit growth. By January 1, 2013, he believes its core tier-1 ratio will be 8.45%, if Basle III rules are applied – the level boosted by an expected 115 basis point increase, according to analysts’ consensus, from retained earnings.

Ghizzoni’s comments come after Intesa Sanpaolo’s recent €5 billion rights issue, which took the bank’s core tier-1 ratio to 10%, under current rules, and setting a new standard for commercial Italian banks. The country’s second biggest bank by assets made the cash call even though it, like UniCredit, already claimed to be Basle III-compliant.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree