UniCredit to Raise $14 Billion, Shed Bad Loans and Cut Jobs in Overhaul
13 December 2016 - 7:40PM
Dow Jones News
ROME—UniCredit SpA on Tuesday said it planned to launch a €13
billion ($13.8 billion) rights issue, a massive cleanup of its
balance sheet and slash thousands of jobs, as part of an overhaul
aimed at bolstering its capital base.
The bank, Italy's largest by assets, said it planned to shed
€17.7 billion of gross bad loans by bundling them into securities
that will be sold to investors.
It added that it will take a €12.2 billion one-off hit in risk
charges for the fourth quarter of this year, in preparation for the
balance sheet cleanup. These charges will include €8.1 billion in
provisions for losses on bad loans.
UniCredit's strategic plan also includes the bank cutting 14,000
jobs to save about €1.1 billion in personnel costs.
To regain its financial footing, the bank has already sold a
number of assets since Jean-Pierre Mustier took the helm earlier
this year and announced a strategic review.
On Monday, UniCredit said it had agreed to sell its
asset-management unit Pioneer Investments to France's Amundi SA for
€3.88 billion.
Write to Giovanni Legorano at giovanni.legorano@wsj.com
(END) Dow Jones Newswires
December 13, 2016 03:25 ET (08:25 GMT)
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