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Italy is shaping up to be the busiest market for bank mergers in Europe in 2021 amid a wave of domestic consolidation across the continent that has been accelerated by COVID-19.
Read more about the factors driving banking M&A within Europe:
After 2020 surge, European bank M&A poised to enter bull market
Weak profits, rising costs and the lack of scale to compete in a still-fragmented market have been driving European domestic bank consolidation for some time, particularly in overbanked markets such as Spain and Italy. In 2019, Spain had the second-highest number of bank branches in the eurozone at 49.66 per 100,000 adults, and Italy ranked third with 38.79 branches, compared to the eurozone average of 20.2 branches, according to World Bank data.
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10 Dec, 2020 Author Jennifer LaidlawMohammad Abbas Taqi
Crédit Agricole SA s acquisition of Credito Valtellinese SpA would strengthen the lender s foothold in Italy and bolster its position in lucrative small and medium-sized enterprise lending and in asset management at a relatively cheap price if it can get it.
The French bank expanded in Italy, its so-called second home market, through the 2017 acquisition of three small Italian savings banks and their subsequent merger with its Italian business Crédit Agricole Italia SpA, the eighth-largest Italian bank by assets, according to S&P Global Market Intelligence data. The Creval deal would place it in fifth position and strengthen its position in the north of Italy, the country s economic powerhouse.