MILAN: Investors must be able to assess the outlook for European banks, in terms of regulatory impacts and future dividend payments following a temporary payout freeze triggered by COVID-19, the head of Italy's top bank UniCredit said.

Taking part to a panel discussion at the Frankfurt Finance Summit, Jean Pierre Mustier said the pandemic would drive an increase in corporate debt and higher loan loss provisions for banks, adding both firms and banks had to be able to attract capital.

Mustier said it was important to make sure the banking industry remained a "truly investible sector."

"We need to give more visibility ... to investors even in the current environment on what the regulatory evolution will be ... (it is extremely important) to make sure that international investors have visibility on how European banks will be able to pay dividends in the future, under which framework, under which constraints," he said.

"The regulator has taken decisive action to give banks more flexibility, regulatory forbearance if you want, but we need to have more visibility specifically on what could happen next in terms of Basel IV for instance (so) that we will be able to tell investors what European banks need to do ... to repair their balance sheet ... and what will change," he added.