MILAN (Reuters) - UniCredit’s (CRDI.MI) shares rose more than 4 percent on Monday after a newspaper report said former industry minister and veteran banker Corrado Passera could be appointed to lead Italy’s biggest bank by assets as early as this week.
UniCredit has been in limbo since CEO Federico Ghizzoni agreed to step down on May 24 without a clear successor.
The uncertainty has weighed on the stock, which has lost 21 percent since Ghizzoni’s decision, also because most bankers and investors expect any new CEO to have to launch a multi-billion euro capital increase to bolster the bank’s financial strength.
Daily newspaper Il Fatto Quotidiano reported on Sunday that 61-year old Passera, who left banking in 2011 to join an emergency government of technocrats as Italy came close to a Greek-style debt crisis, would be named UniCredit CEO this week.
UniCredit declined to comment while it was not immediately possible to reach Passera for a comment.
A source close to a key shareholder in the bank said on Monday that Passera was one of the names being considered for the job by the bank’s top investors, but that no decision had been taken.
He became CEO of Banca Intesa in 2002 and then of Intesa Sanpaolo (ISP.MI) after its merger with Sanpaolo IMI — a tie-up which created Italy’s biggest retail bank.
Passera was also the architect of a turnaround at Italy’s post office between 1998-2002.
Although he founded his own center-right party and briefly ran for Milan mayor against Prime Minister Matteo Renzi’s candidate, he has connections across the political spectrum and it was a center-left government that gave him the job at then fully state-owned Poste.
“Passera would be positive for UniCredit’s shares, if confirmed it could fuel gains in the short term even though the challenges for the new CEO are known and significant,” said a Milan trader.
The shares rose 4.4 percent to 2.52 by 4.24 a.m. ET in a sharply higher Italian banking sector.
The bank’s chairman has said no appointment would be made before the end of July, but Economy Minister Pier Carlo Padoan pressed for a quick decision on Friday, saying the uncertainty created an “element of weakness” for the bank.
Reporting by Paola Arosio and Valentina Za writing by Silvia Aloisi