UniCredit CEO confident on success of rights issue

MILAN Jan 5 (Reuters) - The chief executive of UniCredit told an Italian daily on Thursday he was confident investors would underwrite nearly all of a 7.5 billion euro rights issue that the top Italian bank launched at a massive discount on Wednesday.

In an interview with Il Sole 24 Ore CEO Federico Ghizzoni also said the bank planned to keep holdings of Italian government bonds at current levels.

"On government bonds we will continue to do what we did in 2011 at auctions. If necessary we will buy and we'll then contribute to sell on the market. The idea is to keep volumes in our portfolio at current levels," Ghizzoni was quoted as saying.

The manager reiterated his position that liquidity provided by the European Central Bank should be used primarily to lend to families and companies.

In an unprecedented move, the ECB injected in December almost 500 billion euros of longer-term liquidity helping demand for short-term Italian and Spanish government bonds. But longer-term Italian bonds remained under pressure.

UniCredit announced on Wednesday the terms of a rights issue which will start on Jan. 9 and close on Jan. 27.

"I believe the capital increase will be basically all underwritten by markets," Ghizzoni told Il Sole.

(Writing by Valentina Za)