Italian bank UniCredit shares sink on CEO departure

Shares in Italian bank UniCredit sank 7% on Tuesday after the bank announced overnight that CEO Jean Pierre Mustier is leaving in April due to strategy differences with the board

Italy Unicredit (Copyright 2018 The Associated Press. All rights reserved.)

Shares in Italian bank UniCredit sank 7% on Tuesday after the bank unexpectedly announced that CEO Jean Pierre Mustier is leaving in April due to strategy differences with the board

Mustier, 59, was appointed CEO in 2016, and has steered the bank to financial fitness through a rigorous restructuring plan. But the French executive has more recently been under pressure to merge with the weakened Italian bank Monte dei Paschi di Siena.

In a statement issued late Monday he indicated that his current strategy “and its core pillars no longer correspond to the board’s current thinking." He said his retirement would allow the board “to elaborate a future strategy.”

Mustier’s five-year mandate was due to end in April though the news that he would not be kept on was unexpected. His aggressive turnaround plan included shedding billions in sour loans and thousands of jobs.

Shares were trading down 6.6% at 8.06 euros ($9.65) amid analyst fears of a dangerous period of limbo for Italy’s largest bank by assets. The bank’s shares have lost 35% of value in the last year under the economic effects of the pandemic.

Mustier had planned to announce an updated strategy early next year. His plan through 2023 includes shedding another 8,000 jobs in a bid to grow net profit to 5 billion euros by 2023.