English troubles for Unicredit. According to the Financial Times, hedge fund Caius Capital approached the European Banking Authority (Not) to counteract the calculation of Cet1 of the Italian institute, considering it incorrect according to EU rules.
In particular, according to Caius, for the data to be truthful the Bank should convert the nearly 3 billion euro of complex financial instruments issued in 2008 into ordinary securities (cashes).
Unicredit's response was not long in coming: "The regulatory treatment of the shares underlying the Cashes was presented to the market in full and confirmed and reviewed by the competent authorities - reads a note from the Bank - As announced at the end of 2017, Unicredit has a solid capital position with a CET1 ratio of 13,6%. The contribution to the Bank's capital of the shares underlying the Cashes has no material impact on the Group's capital ratios”.
In short, for the Italian Bank, the treatment of the shares underlying the Cashes complies with the regulations and "there are also contractual clauses which, in the event of regulatory developments, make it possible to preserve the capital position of UniCredit also through the automatic conversion of the instruments underlying the Cashes in common stock”.
In the wake of the news, the Unicredit stock on the Stock Exchange managed to lose 2,8%, to 17,39 euros, in an overall difficult day for Piazza Affari (Ftse Mib -2,2%), with the banking sector particularly impressed with sales.
