Italy's BPER needs time before M&A deal, bank's top investor says

MILAN: BPER Banca in the coming months will focus on integrating branches it bought from Intesa Sanpaolo while merger plans will have to wait, the top investor in the Italian bank said on Friday.

Italian banking shares have been rising on the prospect of consolidation spurred by tax incentives the government has introduced for mergers taking place this year.

BPER, Italy's fifth-largest lender, has long been seen as the best partner for Banco BPM in a deal that would create Italy's second-largest bank by market share.

Back in 2007 a merger between the two banks fell apart just before being announced, and they have been eyeing each other on and off ever since.

Sources told Reuters in December the two banks were considering a merger that would take shape in the first half of the year.

"We think that consolidation in banking industry will happen ... and, as a shareholder, we are open to any option that works in favour of our investment," Unipol CEO Carlo Cimbri told analysts on a conference call after the insurer presented full-year results.

Unipol, Italy's no.2 insurer, is the single largest investor in BPER with a stake of around 19%.

In November Cimbri backed the idea of a merger between BPER and Banco BPM, saying the plan was "fascinating".

Indirectly pouring cold water on the prospect, Cimbri on Friday said BPER had to work first on integrating into the group the newly acquired employees and assets as it also prepared to appoint a new board in April.

BPER, based in the northern Emilia Romagna region, last year agreed to buy 600 branches as part of Intesa's takeover of rival UBI Banca.

"It's not in the coming months that BPER can carry out an extraordinary operation ... it has to take its time," Cimbri said.