Italy's largest bank is preparing to unveil a €13bn (£10.9bn) rights issue this week, in a move that should help calm fears about the future of the country’s embattled lenders.

Unicredit is expected to announce the bumper share sale in London as part of a capital markets day with the City, during which it will also outline plans to offload assets and implement wide-ranging cost cuts.

It comes as the Italian government grapples with the biggest banking crisis in its history.

This weekend, Rome has been putting together emergency proposals to nationalise or part-nationalise Monte dei Paschi, Italy’s third- largest lender, after hopes of raising €5bn from private investors faded.