UniCredit shares dropped some 10 percent Thursday before trading was halted with the bank’s share price standing at €4.86 ($6.29). On Wednesday, its share price slid 15 percent after the bank priced the new shares it’s offering to shareholders at a big discount.
UniCredit is trying to raise €7.5 billion ($9.7 billion) to meet new European requirements for banks to thicken their financial cushions against possible losses. The new shares being offered as part of the rights issue have been priced at a 69 percent discount to Tuesday’s closing price.
The aim of UniCredit’s rights issue is to help the bank shore up its capital reserves, in line with European regulatory demands. Last month, industry regulator, the European Banking Authority, said the bank needed to raise around €8 billion.