Italian UniCredit’s stake acquisition in Commerzbank sparks backlash

The German government criticized Italian bank UniCredit’s decision to raise its stake in German lender Commerzbank on Wednesday, calling the move “uncoordinated and unfriendly,” as it intensified rumors of a potential takeover bid.

UniCredit, Italy’s second-largest bank, said earlier Wednesday it had increased its stake in Commerzbank from 21% to around 28%.

“UniCredit is once again taking uncoordinated and unfriendly action,” said deputy government spokesman Wolfgang Buechner. “Unfriendly attacks and hostile takeovers are inappropriate in the banking sector,” he told a regular press conference.

The Milan-based lender surprised markets and Berlin when it announced in September that it had built a significant stake in its German rival. UniCredit has since built its exposure to Germany’s second-largest bank through derivatives as it awaits regulatory approval to take control of the shares.

A large portion of UniCredit’s shares were bought directly from the German government, which sold them off as it looked to unwind its position in Commerzbank. Berlin still holds a 12% stake in the lender, the legacy of a government bailout during the 2008 global financial crisis.

“The federal government, as the largest current shareholder, continues to support Commerzbank in its strategy and independence,” Buechner said. Commerzbank is a “systematically important bank,” whose fusion with another large financial entity would entail “considerable risks, including for employees,” he said.

UniCredit had described its Commerzbank stake as a “pure investment that can be dissolved at any time,” Buechner said. “The federal government expects that UniCredit will make use of this option.”

UniCredit had also “publicly stressed that it did not want to take any further action before the federal elections” slated for Feb. 23, Buechner noted.

Unions have raised fears that a tie-up between the two large banks could bring job losses.