Unicredit wins the battle against Caius Capital. However, the hedge fund has no intention of backing down on its accusations against the bank led by Jean Pierre Mustier.
The EBA – European Banking Authority – has decided to do not open any investigation on the issue of cashes (hybrid instruments used by the bank in relation to the 2008 capital increase) and de facto rejecting the request presented by Caius, confirming the 2012 position. Having noted with satisfaction the choice of the EU body, the Milanese bank also asked the competent market authorities to verify whether there have been possible market abuses by the fund, also evaluating "any other recourse in order to protect its stakeholders, shareholders and bondholders".
"This (the decision of the EBA, ed.) confirms what was previously declared by Unicredit, namely that the treatment of the Cashes has been examined and confirmed by all the competent authorities and that the ordinary shares of UniCredit must be calculated as CET1", reads the note from the institute in Piazza Gae Aulenti.
Le Positive news for the bank boosted the stock which, in a very difficult day for the Ftse Mib and for the shares of the Agnelli Galaxy, is positioned at the top of the list, gaining 1,4%. According to Mediobanca Securities analysts, the EBA's decision closed “a difficult week for Unicredit” “on a positive note”, which has lost share in Piazza Affari (-22% since May).
Even for the analysts of a leading Milanese SIM, the EBA's decision is "positive", because it "puts an end to the dispute over the treatment of Unicredit's cashes" and "confirms the view of the European Central Bank which had already recognized them as tools eligible for the calculation of the Cet1 capital”. According to the experts, "Unicredit will be able to close the second quarter with a Cet1 ratio in the 12,7% area in line with the indications provided".
In this context though Caius Capital does not give up and continues to attack Unicredit: “The response of the EBA does not enter into the substance of our serious accusations. We remain convinced that the transactions on cashes do not comply with important requirements of the Crr (the European regulation on the prudential requirements of own funds of credit institutions and investment firms", commented Toby Dodson, partner of the fund. As stated in a note by Caius , "the EBA has simply deferred the resolution of the issue to the ECB's annual surveillance programs under the Single Supervisory Mechanism (SSM) rather than opening an immediate investigation into the correct operation of the ECB on the Cashes. A disappointing decision with implications long-term, which leaves the shareholders of European banks grappling with continued uncertainty”.
