The European Commission (EC) has granted approval for UniCredit’s acquisition of Banco BPM, contingent upon adherence to specific conditions aimed at maintaining competition in Italy’s banking sector.
UniCredit’s proposal faced scrutiny over potential market power dominance, prompting the Commission to set conditions to address these concerns. Concurrently, the Commission declined a request from Italy’s competition authority to review the merger under national competition law.
Last November, UniCredit proposed an all-stock offer for Banco BPM, valuing the latter at €10.1bn. The move was part of UniCredit’s strategy to solidify its presence in northern Italy and enhance its market share.
Despite Banco BPM initially rejecting the offer, discussions have continued.
UniCredit operates extensively across Italy, Germany, Central and Eastern Europe, with additional minor operations in the UK and US. It ranks as Italy’s second-largest banking group by assets.
Meanwhile, Banco BPM emerged in 2017 through a merger and stands as Italy’s third-largest banking institution by assets.
The European Commission received notification of this transaction on 24 April 2025. The investigation revealed significant competition concerns regarding retail and small and medium-sized enterprises (SME) banking services due to overlapping activities in 181 local areas, leading to fears of increased pricing and reduced competition.
However, no concerns were raised for large corporate client services as adequate competitors remain post-merger.
To resolve these issues, UniCredit has agreed to divest 209 branches in overlapping local areas across Italy, a move designed to alleviate horizontal overlap concerns and preserve market competition. The Commission concluded that these divestments sufficiently address its concerns, ensuring market shares remain moderate post-merger.
The regulatory body stated: “Following the positive feedback received during the market test, the Commission concluded that the transaction, as modified by the commitments, would no longer raise competition concerns in the markets for deposits and loans for both retail consumers and SMEs banking.
“This is because following the divestment, the combined market shares of the merged entity across the relevant local areas will be moderate.”
The decision remains dependent on full compliance with these commitments, with an independent trustee appointed to oversee their execution under the Commission’s guidance.
Regarding the referral request from Italy’s competition authority, the Commission concluded there were no substantial grounds for transferring jurisdiction under Article 9(3) of the EU Merger Regulation (EUMR).
