Bloomberg News

UniCredit Said to Cut Staff as It Shakes Up Equities Unit

October 06, 2011

(Updates with investor comment in fourth paragraph.)

Oct. 6 (Bloomberg) -- UniCredit SpA, Italy’s biggest bank, is shaking up its equities division as part of an investment banking review to focus on its core markets, three people with knowledge of the matter said.

The lender is cutting jobs in its equity brokerage, including sales and derivatives based in London and Milan, said one of the people, who asked not be identified because the plan isn’t public. Among the options the bank is considering is forming ventures with other firms, according to one person.

UniCredit’s corporate and investment-banking chief, Jean- Pierre Mustier, who previously ran Societe Generale SA’s investment bank, is reviewing the unit as the company prepares a business plan to be presented by year-end. Part of the strategy is to concentrate the equity business in UniCredit’s four key markets of Germany, Italy, Poland and Austria, said one person.

“All banks are reviewing their investment banking in the current environment,” said Wolfram Mrowetz, chairman of investment firm Alisei SIM in Milan, which oversees 200 million euros ($268 million). “This division costs too much. A lot of banks are refocusing on their commercial activity.”

Roberto Lazzarotto, global head of equity derivative sales at UniCredit, is leaving the firm, according to a person familiar with the matter. Reached on his mobile, Lazzarotto declined to comment.

A spokesman for UniCredit declined to comment.

Mustier’s Overhaul

Mustier, who joined UniCredit in March, has hired former colleagues Olivier Khayat and Patrick Soulard to increase commissions and market share, particularly in advising on mergers and in managing stock sales. The firm in May combined the debt and equity businesses with merger advice and lending to win more deals.

The European sovereign debt crisis will lead banks to rethink their business models, focusing on costs, efficiency and productivity, UniCredit Chief Executive Officer Federico Ghizzoni said in an interview Oct. 4. “Banks have to accept that for the next two to three years their revenue will not grow too much,” he said. “Banks need to be leaner, in their structure and more focused on their core business.”

UniCredit rose 3 cents, or 3.8 percent, to 82.6 cents in Milan trading. The stock is down 47 percent this year, valuing the lender at 15.9 billion euros ($21.3 billion).

--Editors: Frank Connelly, Dan Liefgreen

To contact the reporters on this story: Sonia Sirletti in Milan at ssirletti@bloomberg.net; Elisa Martinuzzi in Milan at emartinuzzi@bloomberg.net; Francesca Cinelli in Milan at fcinelli@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net


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