Investors to shape the future of Italy’s banking M&A wave, says Central Bank Chief

The fate of Italy’s ongoing banking mergers and acquisitions (M&A) spree will ultimately rest in the hands of investors, according to the country’s central bank governor, Fabio Panetta. Speaking at the annual Assiom-Forex financial conference, Panetta emphasized that while regulators focus on ensuring the financial stability and viability of the merged entities, market forces and shareholders will determine the final outcome.

The current wave of consolidation aims to bridge the gap between Italy’s banking sector and its European counterparts. Compared to France, Italy’s top five banks hold just a quarter of the total assets, and they also lag behind Spanish and German banks.

“While achieving scale in banking comes with both benefits and challenges, these mergers should be viewed within the broader framework of European market integration and consolidation,” Panetta noted.

Among the major deals in motion, UniCredit, Italy’s second-largest bank, has made a bid for Banco BPM, which is simultaneously looking to acquire asset manager Anima Holding. Meanwhile, state-backed Monte dei Paschi di Siena has set its sights on Mediobanca, and BPER Banca is pursuing Popolare di Sondrio. Additionally, UniCredit has taken a 28% stake in Germany’s Commerzbank, with the possibility of a full acquisition pending regulatory approval.

Panetta reassured that the central bank’s role is to assess whether these transactions create “a viable, efficient” institution that adheres to sound management principles and supports economic growth without jeopardizing financial stability. However, he stressed that the success of these mergers will ultimately be shaped by investor confidence and market dynamics.

The surge in M&A activity is being driven by banks’ excess capital reserves and a strategic push for cost efficiencies, especially as declining interest rates begin to squeeze lending margins.