UBI Said to Hire Credit Suisse, Morgan Stanley to Explore Deals

Unione di Banche Italiane SpA, Italy’s fifth-largest bank, hired Credit Suisse Group AG and Morgan Stanley to advise on a potential merger after it converted into a joint stock company, two people with knowledge of the matter said.

The bank hired the two firms as it explores strategic options to combine with another lender, the people said, asking not to be identified because the appointment isn’t public. Credit Suisse has been working informally with the bank for several months, one of the people said.

UBI is among Italy’s cooperative banks, known as popolari, that are considering tie-ups as new rules force them to give investors voting rights that reflect the size of their shareholdings. Chief Executive Officer Victor Massiah has repeatedly said that the bank may combine with rivals and he is in talks with all potential partners, without naming possible targets.

Under sweeping rules approved in March, the country’s 10 largest cooperative banks will be transforming over coming months. Popolari lenders that have assets of at least 8 billion euros ($8.7 billion) each will have to abolish rules restricting the size of a single investor’s holding and limiting shareholders to one vote each, two main obstacles for consolidation. UBI has been the only bank that has completed the transformation.

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