The Italian bank Unicredit just launched a 10.1 billion euro offer to acquire Banco BPM, potentially entailing one of the biggest operations in the Italian banking market of the last years. This move is part of the phenomenon labeled by Italian media as “banking Risk”, in reference to the famous board game, describing to the tendency of banks to form bigger and bigger entities, making them more internationally competitive.
Unicredit launched a Public Exchange Offer (PEO) with which Banco BPM’s shareholders can exchange each of their shares for 6.66 euros in Unicredit shares. Through the final objective of acquiring the totality of Banco BPM, Unicredit aims to reinforce its position as the first Italian banking group, controlling 14% of all bank deposits in Italy, and increasing its presence in Northern Italy, according to the CEO, Andrea Orcel. The operation arrives after Unicredit acquired 30% of the German Commerzbank, a move not seen with good eyes by the German government.
The acquisition, however, must first be approved by Consob, the Italian stock exchange regulator, as well as by Unicredit’s shareholders, whose assembly is set to meet in April 2025. Furthermore, the CEO of Banco BPM has said multiple times that the bank is not interest in the ongoing “game of Risk”, underscoring the intention of the entity to continue being independent.
The formation of EU-wide financial entities, although better equipped to deal with competition of American and Asian firms, puts additional pressure on regulators in making sure that European banks do not harm consumers and that their operations work in favor of Europe’s best interests.
Author: Luis Cabezas
Photo: Freepik