UniCredit on Tuesday said it had increased its equity stake in Commerzbank to about 20 per cent, as the Italian bank doubles down on a potential takeover of Germany’s second-largest lender despite opposition from Berlin.

Italy's second biggest bank UniCredit owns an equity stake of around 20%, with corresponding voting rights, in Commerzbank after converting into shares derivatives which gives it an overall 29% holding in its German rival.

Italian lender UniCredit has increased its equity stake in Commerzbank to 20% by converting derivatives into stock. The move positions UniCredit as the largest shareholder of Commerzbank, surpassing the German government,