MILAN, Jan 12 (Reuters) - Italy's fifth-largest bank UBI Banca said on Thursday it would launch a share issue for up to 400 million euros ($425 million) to strengthen its capital after offering to take over three small rescued banks.
UBI approved a binding offer worth 1 euro to buy Banca Marche, Banca Etruria and CariChieti, which Italy rescued from bankruptcy in November 2015 and struggled to find a buyer for in the course of last year.
Private equity bids were rejected over the summer as too low and an acquisition by UBI took longer than expected partly due to a number of conditions set by the lender.
UBI said its offer was subordinated to the fact that Italy's resolution fund inject 450 million euro in capital into the three banks before the closing of the sale.
The banks must also offload 2.2 billion euros in problem loans before then.
$1 = 0.9405 euros Reporting by Valentina Za