EUROPE - Unicredit has denied that the Italian central bank blocked the sale of Pioneer Investments, its asset management subsidiary.

French fund managers Amundi and Natixis and UK insurer Resolution had emerged as potential buyers during the long period in which Italy's largest bank had considered its options for the subsidiary.

Also mooted was a merger with Intesa Sanpaolo's fund management arm - apparently the favoured option of the Italian government.

But a spokesman for Unicredit said today it had decided to keep Pioneer because it "didn't think the offers would add more value than keeping it as a standalone activity".

The spokesman added: "It was a straightforward business decision. The offers came from important players, but there would be no dramatic difference in future prospects whether we sold or not. So we decided to keep it inside our own perimeter."

In a press statement, the group said Pioneer would focus on organic growth after strong financial performance in 2010.

The statement said: "The business is in much better shape than it was when the review process was launched."

Pioneer's assets under management grew from €176bn in 2009 to €187bn in 2010.

Unicredit is currently working on a strategy to improve Pioneer's product offering.

Recent pressure on Unicredit to increase its tier-one capital ratios in line with Basel III give traction to rumours that it had favoured a sale, but had been blocked.

The bank was recently given to the end of the year to raise its capital ratios, though both Unicredit and the Bank of Italy agree this will not necessarily mean a new rights issue.