UniCredit is preparing to issue significant risk transfers tied to roughly €5 billion of loans, according to people familiar with the matter. The Italian bank aims to offload credit risk from its portfolio, a move that could free up capital and improve its leverage ratios. The transactions are denominated in dollars and euros.

This strategy follows a broader trend among European lenders seeking to optimize balance sheets without outright loan sales. By using SRT structures, banks transfer default risk to investors while retaining the loans on their books. For UniCredit, the deal could enhance its return on equity and satisfy regulatory capital requirements more efficiently.

Market participants will watch pricing and investor appetite for these transfers, which serve as a barometer for the bank’s asset quality. Successful execution could encourage other lenders to pursue similar deals, deepening the European structured credit market. The transactions are still in planning stages, with details subject to change.