MILAN, Dec 7 (Reuters) - Banco Popolare's chief executive resigned on Sunday after the Italian bank's stock fell to a year low amid growing concerns about the cost of supporting struggling leasing company Banca Italease.
After an extraordinary meeting of the bank's management and supervisory boards, Popolare issued a statement saying Fabio Innocenzi would be replaced as CEO by Pier Francesco Saviotti, vice president for Europe at Merrill Lynch.
It did not give a reason for Innocenzi's departure.
Popolare's stock ended Friday at a year low of 4.84 euros as investors fretted about the cost of supporting Italease after the leasing company lost a joint venture partner. Popolare owns about 30 percent of Banca Italease.
The stock, which has lost 68 percent of its value since January, had been falling for days; the bank at one point came out with a statement saying its share price did not represent Popolare's adequate financial standing.
The stock began falling at the beginning of the month when VR Leasing, a unit of Germany's DZ Group, abandoned plans to form a joint venture with Italease.
The venture would have seen VR Leasing take a 60 percent stake in Italease for 369 million euros.
Its departure forced Popolare and other core shareholders of Italease to give the leasing company a 2 billion euro line of credit.
Investors saw it as a costly failure for Popolare, a medium-sized bank.
Italease, whose shares have also fallen heavily, has been restructuring after sustaining huge losses from derivatives investments last year.
The change in command at Popolare comes as the banking sector is confronting the repercussions of the global financial crisis.
Italy's government has come up with an offer of up to $15.5 billion in support for the country's banks, but the banks have maintained that they do not need the help and can fend for themselves.
Given their conservative ways of doing business, Italian banks have not suffered as much as banks elsewhere in Europe from the crisis.
(Reporting by Gilles Castonguay; Editing by Leslie Adler) Keywords: BANCOPOPOLARE/ (gilles.castonguay@thomsonreuters.com; +39 for 02 6612 9507; Reuters Messaging: gilles.castonguay.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2008. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
After an extraordinary meeting of the bank's management and supervisory boards, Popolare issued a statement saying Fabio Innocenzi would be replaced as CEO by Pier Francesco Saviotti, vice president for Europe at Merrill Lynch.
It did not give a reason for Innocenzi's departure.
Popolare's stock ended Friday at a year low of 4.84 euros as investors fretted about the cost of supporting Italease after the leasing company lost a joint venture partner. Popolare owns about 30 percent of Banca Italease.
The stock, which has lost 68 percent of its value since January, had been falling for days; the bank at one point came out with a statement saying its share price did not represent Popolare's adequate financial standing.
The stock began falling at the beginning of the month when VR Leasing, a unit of Germany's DZ Group, abandoned plans to form a joint venture with Italease.
The venture would have seen VR Leasing take a 60 percent stake in Italease for 369 million euros.
Its departure forced Popolare and other core shareholders of Italease to give the leasing company a 2 billion euro line of credit.
Investors saw it as a costly failure for Popolare, a medium-sized bank.
Italease, whose shares have also fallen heavily, has been restructuring after sustaining huge losses from derivatives investments last year.
The change in command at Popolare comes as the banking sector is confronting the repercussions of the global financial crisis.
Italy's government has come up with an offer of up to $15.5 billion in support for the country's banks, but the banks have maintained that they do not need the help and can fend for themselves.
Given their conservative ways of doing business, Italian banks have not suffered as much as banks elsewhere in Europe from the crisis.
(Reporting by Gilles Castonguay; Editing by Leslie Adler) Keywords: BANCOPOPOLARE/ (gilles.castonguay@thomsonreuters.com; +39 for 02 6612 9507; Reuters Messaging: gilles.castonguay.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2008. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.