Italy's UniCredit ups Alpha Bank stake to 29.5% via derivatives (updated)

Alpha Bank SA

30/10/2025 07:42

Has built stakes in rivals as part of M&A strategy

Has failed so far to clinch a merger deal

Using stakes to contribute to bank's profits

Adds details on capital impact, decision-making process on converting rest of stake in paragraphs 6-11

By Valentina Za

MILAN, Oct 30 (Reuters) - Italy's second-largest bank UniCredit CRDI.MI said it had raised its stake in Greece's Alpha Bank ACBr.AT to 29.5% using derivatives, after securing supervisory approval to go up to 29.9%.

Under CEO Andrea Orcel, UniCredit has embarked on a complex external growth strategy, seeking to expand in its main two markets, Germany and Italy, with the latter currently swept by a hectic consolidation wave.

Unable to clinch merger deals — partly due to resistance from Rome and Berlin — it has built stakes in rivals like Commerzbank  and Alpha.

Using the "equity consolidation" accounting method, UniCredit can book part of these banks' profits in its own earnings.

"After receiving all the remaining regulatory approvals, 9.8% of the stake currently held by UniCredit will be equity consolidated, bringing an equivalent amount of Alpha Bank net profit to both UniCredit revenue and net profit lines," it said.

UniCredit became Alpha's main shareholder in 2023. It used derivatives to increase its stake to nearly 26% in August, pending ECB clearance to approach 30%.

UniCredit said it had managed to buy more Alpha shares at a discount to market prices and hedged downside risks at favourable terms.

A full equity conversion of the 29.5% stake would reduce its core capital ratio by around 80 basis points.

Decisions on converting and consolidating the rest of the Alpha stake, as well as a 3% portion of the 29% Commerzbank stake still held as derivatives, will take into account the trade off between returns and profits on the one hand, against capital impact and distribution on the other.

Orcel has used UniCredit's tens of billions of euros in capital reserves to buy back the bank's shares and boost shareholder returns.

An eightfold increase in the share price since Orcel arrived in 2021, helped by the buybacks, has now lessened their appeal, with analysts pointing to higher returns from a merger.

 (Reporting by Valentina Za
Editing by Bernadette Baum and Tomasz Janowski)

 ((valentina.za@thomsonreuters.com; +39 02 6612 9526;))