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The appointment of UniCredit’s French chief executive Jean Paul Mustier — the first non-Italian to hold the post — was meant to signal a break with tradition. So far he has tinkered, but reports that the bank is considering a €13bn capital raise could provide occasion for an overdue fundamental overhaul.

UniCredit’s problem is twofold. It has a large stock of non-performing loans (15 per cent of gross lending, two-thirds of which are in Italy), and an unwieldy network of operations across 17 countries perceived as too complex.

Any capital raised would go towards settling the first concern. An equity issue (UniCredit’s fourth since 2009) would be heavily dilutive: at market prices the share count would more than double. But allowing UniCredit to sell off or write down NPLs to their market value — while increasing the bank’s dismal core equity tier one capital ratio (10.3 per cent) — would remove a major drag on profitability.

On the second issue, Mr Mustier has tentatively sold down stakes in a foreign asset (Poland’s Bank Pekao) and one in Italy (online bank Fineco). He should be bolder. It is unclear what UniCredit gains from holding a non-controlling stake in Turkey’s Koc Finansal, nor its fully owned German lender HVB while the latter is prevented from transferring excess capital to the parent (its CET1 ratio is 23.5 per cent). A sale or initial public offering of both is preferable.

Yes, this would give UniCredit greater exposure towards its domestic market (over half of revenues comes from abroad). But contrary to popular perception, the words “Italian” and “banking” need not equal value destruction: UniCredit’s biggest division, Italian commercial banking, is the only one to have steadily grown operating profits since 2012 (6 per cent annually), despite Italy’s recession.

Trading at barely 0.3 times book value, UniCredit shares are priced for radical intervention. A large capital raise would provide Mr Mustier with his moment.