UniCredit leads Italian banks lower on Cyprus plan

MILAN: Italian banking shares opened sharply lower on Monday after Cyprus' plan to tax depositors rattled investors and raised fears that the move, if passed, could set a precedent for future euro zone bailouts.

UniCredit was the top loser among banks, shedding 4.9 percent at 3.6 euros, while Intesa Sanpaolo fell 4 percent. Banco Popolare, which announced a bigger than expected net loss for 2012 after the market close on Friday, was down 4.7 percent.

"Cyprus is the main driver for the banks today, even though there is also concern about the rise in loan loss provisions," said a Milan trader.