MILAN: An influential shareholder in Italy's biggest bank by assets, UniCredit, said on Monday the lender may need a change of management as Chief Executive Federico Ghizzoni battles to retain investors' confidence.
Leonardo Del Vecchio, a veteran Italian entrepreneur who holds just under 2 percent of UniCredit, is the first shareholder in the bank to publicly state it may need a new CEO.
"Ghizzoni is a good banker," Del Vecchio, who as recently as October had expressed his support for Ghizzoni, told La Repubblica newspaper in an interview.
"But perhaps the bank today needs changes that are so radical that they can only be achieved through discontinuity," he said.
UniCredit declined to comment.
Rumours of investor dissatisfaction with Ghizzoni have dogged the bank for months as UniCredit has failed to put to rest worries it may need a capital increase to bolster its finances.
Deputy Chairman Luca Cordero di Montezemolo said on Thursday, however, that Ghizzoni had the support of shareholders.
The bank, which releases annual results on Tuesday, compares unfavourably with domestic rival Intesa Sanpaolo, which makes twice as much profit and has a higher core capital level.
With Italian banking shares suffering a steep sell-off due to concerns about their mountain of bad loans, UniCredit shares have lost nearly 40 percent of their value since the start of the year.
In an attempt to boost earnings, Ghizzoni in November presented a new business plan announcing 18,000 job cuts and vowing to restructure or sell businesses in Austria and Italy.
He has repeatedly ruled out the need for a capital increase and earlier this month said the bank's 2015 results were good and in some respects better than expected.
A foreign investor in the bank who spoke on condition of anonymity due to the sensitivity of the topic said UniCredit was perceived as lacking capital.
"It's fair to say that current CEO is not getting strong support from investors," the investor said.
"So at this stage, only a good set of full-year results could bring down worries around capital. On the other hand, my feeling is a management change now would raise concerns about a possible capital increase."
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