No wonder investors think twice before jumping into UniCredit stock. One moment it’s in negotiations with the Italian government about buying one of the most notorious basket cases in Europe banking, Banca Monte dei Paschi di Siena (MPS). And then comes news that the Italian lender has been doing due diligence on a bailed-out top-tier bank in Russia, Otkritie, just as troops are massing near the border with Ukraine.
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Indeed, chief executive Andrea Orcel is understood to have joined other Italian executives on a call with Russian president Vladimir Putin in late January – against the Italian government’s wishes – in what could be a sign of the bank’s commitment to its Russian business. The Otkritie acquisition, however, has proven unfeasible considering the geopolitical environment.
These kind of wild news swings are nothing new. UniCredit’s investors and staff have had a bumpy ride in recent years.
Chairman Pier Carlo Padoan’s arrival on the board in late 2020 precipitated the exit of chief executive Jean Pierre Mustier, previously hailed as the bank’s saviour for pulling off a €13 billion rights issue in 2017 after the Italian non-performing loans crisis.
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