MILAN Italian bank Popolare di Vicenza said on Friday the European Central Bank had asked it to improve its liquidity position and assess all options to cut its stock of bad loans as it readies a new business plan.
Like rival Veneto Banca, Popolare di Vicenza was taken over by Italy's bank rescue fund Atlante earlier this year when it failed to find buyers for an initial share issue needed to keep it afloat. The ECB has told the two banks to study a possible merger and present a new business plan.
Popolare di Vicenza said the ECB had reiterated the request for an updated strategy as part of its annual supervisory process. The ECB also wants a funding plan outlining measures to stabilise the bank's liquidity coverage ratio - a key funding indicator - at no less than 10 percentage points above the minimum requirement.
Popolare di Vicenza on Friday signed an accord with unions to cut up to 300 employees through early retirements.
(Reporting by Valentina Za)