Whatever the judicial developments in the Palenzona case, in which the powerful vice president of the first Italian bank by total assets is being investigated by the Florence prosecutor's office for financial crimes aggravated by aiding and abetting mafia clans reporting to the boss Matteo Messina Denaro, the CEO Unicredit, Federico Ghizzoni has decided to immediately strike a blow by sending a strong signal to the markets to defend the bank's reputation. He will do it even before the launch of the new business plan of next November 11 in the awareness that without the full recovery of credibility the plan would start with the brakes on.
Ghizzoni wants to review the governance mechanisms of the group but also to implement a clean up that leaves no shadow of a doubt about Unicredit's reputation and transparency. This is why the short-term convening of an extraordinary board of directors in which the heads of important top managers such as the risk manager, Massimiliano Fossati and the head of corporate and investment banking, Alessandro Cataldo, is considered highly probable.
For Ghizzoni, the cleanup and the new governance, which among other things will ban relations between the bank's managers and board members, are essential to polishing the image of the first truly international Italian bank, weakened in some way – even before the Palenzona case broke out – from the surprise exit of a top manager of the caliber of Roberto Nicastro, sacrificed on the altar of internal reorganization and the centralization of functions in the hands of Ghizzoni himself.
The crackdown in the next few hours will only be the first stage of therelaunch operation which Ghizzoni has in mind and which will lead to the new industrial plan which, according to the first rumors, will be even more robust than expected and which will probably provide for a number of redundancies greater than that initially calculated in at least 10 thousand units, mainly concentrated in Germany and Austria but such as to also concern Italy, albeit with incentivized redundancies and agreed exits.
To regain the favor of the markets, the CEO of Unicredit knows that he must clear the field of any sort of uncertainty and that only strong measures can prevent the risk of a new capital increase that shareholders like the Stock Exchange see as smoke in the eyes.
