Market News

By Francesco Canepa and Balazs Koranyi

• Six policymakers see tie-up favourably
• Say little ECB can do to influence outcome

FRANKFURT, Sept 25 (Reuters) - Six European Central Bank policymakers told Reuters they were broadly in favour of a tie-up between Italy's UniCredit and Germany's Commerzbank and viewed Berlin's opposition to a deal as running against the principle of European integration.

The German government is putting pressure on UniCredit (CRDI.MI) to drop its plan to merge with Commerzbank (CBKG.DE), criticising the Italian bank's "aggressive" tactics and backing efforts by Germany's second-largest lender to stay independent.

The ECB's 26 policymakers will have the final say on whether any deal can go through. Conversations with half a dozen of them revealed frustration at Germany's attitude, which some said was hypocritical.

All spoke on condition of anonymity because they are not authorised to comment on individual banks.
They pointed to Germany's stated support for creating a banking union in the European Union and regional champions in other sectors, such as defence, as well as its defence of free market principles in matters including monetary policy.

The policymakers said that in principle they are in favour of a deal they view as building a larger banking group operating in multiple European countries - a longstanding ECB goal. The ECB acts as supervisor of the euro zone's biggest banks.
But they said the ECB could do little to influence the outcome of the political tussle, other than reaffirming the importance of a banking union.

An ECB spokesperson declined to comment.

UniCredit, with a market value three times as large as Commerzbank's, is seeking the ECB's approval to raise its stake in the German bank to 29.9%, having built it up to close to 21% through a mix of shares and derivatives.

That decision will be made by the ECB's Supervisory Board. Chaired by Germany's Claudia Buch, it includes representatives from 21 countries and focuses on prudential aspects such as capital, liquidity, business plans and governance.