The share price of UniCredit rose yesterday (March 11th) despite the bank announcing a record low in its latest financial results.
Italy's largest bank revealed it is going to cut 8,500 jobs in a bid to improve its financial situation, which included the record annual loss of 14 billion euros (£11.7 billion).
With European regulators planning to carry out an industry-wide health-check in the next few months, it will be vital UniCredit can get its house in order and boost its financial position before that takes place later in the year. Some 13.7 billion euros was put aside by the company to cover losses from bad loans in 2013.
Stocks in the company rose by six per cent on the back of the announcement, perhaps as analysts had expected the results for the full year 2013 to be even worse than they were.
UniCredit's chief executive, Federico Ghizzoni, stated that he believes the bank has now "turned the page" and will be able to enjoy a brighter future as a result of climbing away from rock bottom. He said: "We could have staggered the losses over several years. We decided to take them all in one year. I am serene. We have done more than what will be required."
The losses announced by UniCredit are among the worst revealed by any bank in Europe since the start of the global financial crisis, which badly affected institutions around the continent. The knock-on impact of the crash also hit banks hard and many are still struggling with the after-effects of the recessions caused in many European countries.
After yesterday's six per cent rise in its share price, stocks in Italy's biggest bank are up again in the early stages of trading this morning. By 08:09 GMT, the share price in the bank were up by 0.78 per cent and still rising as the session continued. Stocks were at 6.47 and closing in on the company's 52-week high of 6.54.
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