Unicredit (UBM)

Unicredit Bank Milan, or UBM, is a leading Italian bank with a large international presence particularly in Eastern Europe. It has investment banking operations in Milan, Frankfurt and Munich. Its core markets are Italy, Austria and Southern Germany. Unicredit has more than 40 million customers with over 177,000 employees in 22 countries. It has around one and a half trillion dollars in assets. There are over 10,000 branches.

Unicredit was originally called UniCredito Italiano SpA although this was changed in 2008 by taking out the reference to Italy. The Italian name was due to the fact that it was formed by a merger of a number of mid-sized Italian regional banks in 1998, led by Credito Italiano and Unicredito. Its strong roots in Italy’s consumer bank market gave it a deposit base that meant that it could use the money to buy fledgling banks in Eastern Europe. Its headquarters are in Milan and Rome.

Most of the investment banking that it takes part in is as a result of its takeover of HypoVereinsbank, or HVB, the second largest retail bank and private financial institution in Germany. It is especially strong in Bavaria. HVB had some investment banking operations in Munich, Frankfurt and London which were mostly an outgrowth of their retail banking network offering help to Bavarian companies who either wanted to trade abroad or to raise funds through either debt or equity markets. There is a trading operation in London that deals with fixed income and equity transactions.

There is also a strong investment banking presence in Vienna and Moscow, thanks to the purchase of Austria’s largest bank Creditanstalt (which now trades as Unicredit Bank Austria). It has complete control over the Russian commercial and investment bank the International Moscow Bank and it also owns the Russian stock brokerage Aton Capital. Compared to many other similar sized banks there is not really a large investment banking presence within Unicredit. This is due to its history as a group of regional retail banks.

HVB also has a strong offering in both private banking and wealth management under its own brand. Bank Austria Creditanstalt also owned 25% of Bank Medici AG, a private bank that was caught in the Madoff scandal when it was found that it had channelled $2 billion into Bernie Madoff’s funds, losing the whole amount. The bank is now run by the Austrian government. There is a strong research team that deals with most markets, particularly equities, derivatives and debt. Most of its research is published in English.

The Unicredit bank was a 1998 merger of three Italian banks, Credito Italiano, Rolo Banca 1473 and Unicredito. Unicredito and Rolo Banca 1473 ran a number of regionally titled banks across northern Italy. After this there were a couple of mergers with smaller Italian regional banks in 1999. In 2006 Unicredit merged with the German HVB which itself was the result of a merger of the two largest Bavarian banks. HVB also bought in Bank Austria Creditanstalt, the largest bank in Austria. In 2003 it took over Capitalia the third largest bank in Italy which had among other banks owned the Il Banco di Santo Spirito, which was founded by Pope Paul VI and as the banker to the Vatican States was one of the first national banks in Europe.

Among other East European countries that Unicredit has a presence in is Bosnia and Herzegovina, Croatia, Poland, Hungary, Kazakhstan, Latvia and the Ukraine. This was largely as a result of its Austrian operations, as Austrian banks tended to be very aggressive in getting business in Eastern Europe.