Berlusconi Partner May Seek to Limit Libyan Rights in UniCredit

Italian Prime Minister Silvio Berlusconi’s coalition partner, the Northern League, may ask regulators to freeze part of Libyan investors’ voting rights in UniCredit SpA, saying they breach the bank’s statute.

While the statute freezes shareholder voting rights above 5 percent, the Central Bank of Libya owns 5 percent of the Milan- based lender and the Libyan Investment Authority, a sovereign wealth fund, holds 2 percent. The Northern League wants market regulator Consob to probe whether the two investors should be considered a single entity as Libya is ruled by Muammar Qaddafi.

“Libya is a country under dictatorship,” Maurizio Fugatti, a Northern League member for Trentino in the Lower house of Parliament, said in a telephone interview. “If so, Consob should freeze Libyan voting rights exceeding 5 percent.”

While Berlusconi has fostered relations with Libya after signing commercial agreements with Qaddafi in 2009, the Northern League is concerned that UniCredit may neglect its home market. The party wants the bank, which earlier this month received preliminary approval to start a subsidiary in the North African country, to provide more support to small companies in Piedmont and Veneto, said Fugatti.

“Our decisions will also depend on UniCredit’s behavior with clients based in Northern Italy,” said Fugatti. The Northern League will decide whether to approach the regulator in the coming weeks, he said.

A Rome-based spokesman at Consob and a spokesman at UniCredit declined to comment.

“UniCredit, like all banks, has been tight on credit to keep its solvency ratios high, but now that the stress test angst is over they may concede a little to show their good will,” said Patrizio Pazzaglia, a money manager at Bank Insinger de Beaufort NV in Rome. “UniCredit’s foreign investor base is widening and that can create some political strain but I wouldn’t be overly concerned.”

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