Former "Terrorist" State Now Bailing Out Italian Banking Giant

Sunday, October 19, 2008

In a bizarre twist of fates the former Italian colony Libya, once branded a terrorist state by the USA, takes part in bailing out Italy's second largest bank, Unicredit.
Reuters quoted Libyan central bank governor Farhat Omar Bin Guidara who told the Italian daily Il Messaggero that Libya aims to raise its current stake of 4.23% to 5%. Libya paid €500 million for a 3.67% stake, making it the second largest shareholder of Unicredit. It already owned 0.56% of Unicredit since 1997.
Business daily Il24 Ore reported that Libya would push for a seat on Unicredit's supervisory board. Citing an unnamed source, it said the Libyan central bank was aiming for a vice-chairman post and had put Bin Guidara forward as candidate.
Libyas shopping spree does not end here. Italy is OPEC member Libya's main European trade partner and Italian oil company ENI holds stakes in pipeline, natural gas and oil projects in Libya.
"We have bought Eni shares for 50 million euros. A modest number, but an indication of the faith we have in your oil company. And probably we will buy some more, but always keeping in mind the desire of diversification and not necessarily to control," Bin Guidara said.
A fact box courtesy of Reuters says the cross border bank has the most foreign exposure of Italy's banks. Unicredit aquired Bank Austria, by now renamed to Unicredit, and the German banking giant Hypo Vereinsbank in 2005.


Wikinvest Wire