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UniCredit to shut 350 branches, says spread still "unsustainable"
February 19, 2013 / 6:53 PM / 5 years ago

UniCredit to shut 350 branches, says spread still "unsustainable"

MILAN, Feb 19 (Reuters) - UniCredit, Italy’s biggest bank by assets, plans to close an extra 350 branches - or nearly 10 percent of its network - by 2015, CEO Federico Ghizzoni said on Tuesday.

Ghizzoni said 110 of these branches will be shut by the end of 2013, with savings of 15 million euros ($20 million) a year in terms of real estate costs.

UniCredit, which has already closed 800 branches in Italy since 2009, currently has around 3,600 branches in its home base.

Ghizzoni said that at current levels, the spread between Italian 10-year government bonds and equivalent German Bunds was still unsustainable, even if it was much lower than at where it stood at the height of the euro zone debt crisis.

“No one is talking about it any longer, but at 270, 280, 290 basis points the spread is unsustainable. Either it goes down or it creates serious problems for the Italian economy, for banks and companies,” he told reporters.

He said the spread would be one of the key problems for the next Italian government after the Feb. 24-25 parliamentary elections.

He said the latest polls showing the gap closing between rival parties were a reason to be “a little more concerned”.

“Italy needs political stability,” he said. “As a market player, one has to hope for a stable majority.”

$1 = 0.7487 euros Reporting By Silvia Aloisi and Gianluca Semeraro

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