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Intesa Launches €30.6 Billion Bid for Monte dei Paschi

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Italy’s largest lender, Intesa Sanpaolo, has launched an unsolicited €30.6 billion ($35 billion) cash-and-share offer to acquire rival bank Monte dei Paschi di Siena (MPS), marking a new phase of consolidation in the country’s banking sector. The proposed deal offers MPS shareholders a 12.5% premium over the bank’s closing share price on Friday.

To address potential competition concerns, Intesa said it has reached an agreement with insurer Unipol to divest 635 MPS branches and the historic MPS brand if the takeover succeeds. The move mirrors a strategy Intesa used during its acquisition of UBI Banca in 2020, which helped it secure a dominant position in the Italian banking market.

If completed, the merger would create the eurozone’s second-largest banking group by market value after Santander, with a combined capitalization of €126 billion. The transaction would also intensify competition for key financial assets in Italy, including insurer Generali, while accelerating the ongoing consolidation trend among the country’s leading banks.

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Commerzbank to Cut 3,000 Jobs as It Resists UniCredit Takeover Push

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Commerzbank announced plans to cut 3,000 jobs and raise its long-term profit targets as it fights to remain independent amid a takeover attempt by Italy’s UniCredit. The German bank said the restructuring would strengthen revenue and profitability by 2028, while criticizing UniCredit’s €37 billion takeover proposal as unclear and risky. Commerzbank also expects around €450 million in restructuring costs tied to the layoffs.

The takeover battle has become a major issue in Germany’s financial and political circles, with UniCredit CEO Andrea Orcel pushing for a major cross-border European banking merger. UniCredit now holds just under a 30% stake in Commerzbank and argues that larger European banks are needed to compete globally. However, Commerzbank insists it can perform better independently and unveiled stronger targets, including €15 billion in revenue and €4.6 billion profit by 2028.

Germany’s government has openly opposed the takeover effort, with Chancellor Friedrich Merz criticizing hostile banking acquisitions and warning they damage trust. Germany still owns a 12% stake in Commerzbank from a past financial crisis bailout, and some politicians are urging Berlin to increase its holding to block UniCredit’s advances. The announcement came as Commerzbank reported a 9.4% rise in first-quarter net profit, beating analyst expectations.

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ECB Pushes for Simpler Bank Rules While Keeping Capital Demands Intact

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The European Central Bank has proposed major reforms to simplify the EU’s banking rulebook, aiming to streamline supervisory requirements without reducing overall capital burdens. The ECB argues that reducing complexity should not weaken financial resilience, despite industry pressure for lighter regulations as seen in the U.S. and UK. The plan centres on merging several capital buffers into two core layers—releasable and non-releasable—while keeping guidance requirements separate.

Banking groups broadly welcomed the effort but warned that the proposals fall short of delivering the regulatory relief needed to boost competitiveness. German banking associations said the changes do not go far enough, particularly for small lenders, and urged the European Commission to move more decisively. European bank stocks nonetheless gained over 1% following the ECB’s announcement, outpacing wider market performance.

Beyond capital buffers, the ECB also called for reforms to AT1 convertible bonds, questioning whether these instruments truly absorb losses, and recommended an overhaul of EU-wide bank stress testing to make the process more effective. The proposals, backed by the ECB’s Governing Council, must now be reviewed by the European Commission, meaning any concrete changes could take months or even years to implement.

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