Published October 2, 2008

Italy's top two banks take a battering

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(MILAN) Italy's leading banks yesterday felt the shockwaves from the world financial crisis sweeping over Europe as their share prices took a battering.

Italy's top bank UniCredit and its nearest rival Intesa Sanpaolo both saw trading in their shares suspended on the Milan stock exchange.

Shares in UniCredit, which has the most foreign exposure among Italian banks, saw precipitous drops on Monday and Tuesday to their lowest level in 10 years.

They opened up 5.8 per cent at 2.75 euros yesterday after the banking giant announced, just before the opening bell, that it would place part of its real estate assets into a special fund to improve its solvency.

But trading in UniCredit was quickly suspended as the share price dropped to 2.55 euros.

Meanwhile Intesa Sanpaolo's shares lost 5.33 per cent to 3.64 euros in early trading, becoming the second Italian bank to be hit hard by the shockwaves of the US financial crisis.

Italian Prime Minister Silvio Berlusconi said he would 'not tolerate speculative attacks on banks (causing) Italians to lose their savings.' - AFP