UniCredit has presented its plans for the next two years which do not include sale of its subsidiaries in Central and Eastern Europe.
Rumours that Zagrebačka Banka could soon be sold to Societe Generale from France have just been denied by the strategic plan of UniCredit Group, the owner of Zagrebačka Banka, which was released early this morning on the eve of the Investors’ Day which is currently taking place in London, reports Večernji List on December 13, 2016.
The announced strategy for the next two years does not include the sale of subsidiaries in Central and Eastern Europe. Actually, the plans are the complete opposite – their growth. The bank also announced the necessary recapitalization worth 13 billion euros, but the capital will be raised by issuing new shares. The decision on that process is expected to formally be adopted in January.
Part of the required capital will certainly come from the sale of some members of the group. The owner of Zagrebačka Banka has recently sold its Polish subsidiary, Bank Pekao, to insurance company PZU. It also sold its asset management branch Pioneer Investments to Amundi. For Pekao, it received 2.5 billion euros, while Pioneer brought additional 3.5 billion kuna – a total of six billion euros.
The restructuring plan announced this morning, which should put the bank back on its feet, will cost them 12.2 billion euros, and it includes cutting 14,000 jobs from the total of 101,000, closing 944 of 3,800 branches, mostly in Italy, covering a large part of bad portfolios and raising the capital adequacy from 10.5 to at least 12.5 percent.
They have already reached an agreement on the sale of 17.7 billion dollars worth of bad loans to American investors Fortress Investment Group and Pimco. At the same time, the bank intends to simplify and modernize its products and IT processes.
After the announcement, shares of UniCredit first fell by five percent, but after the details of the strategy were presented, the shares grew by nearly eight percent.
Zagrebačka Banka is the largest bank in Croatia and the cornerstone of Croatian banking system. The second-largest bank Privredna Banka Zagreb (PBZ) is also owned by an Italian group, which makes Italy the most important player in Croatian banking sector.
