UniCredit, Italy’s largest bank, saw net profits fell by 22.2 per cent to €1.323 billion last year, amid financial market volatility and a shareholder rebellion which led to a boardroom shake-up.

The profit fall was due in part to “several non-operating, non-recurring items” such as goodwill impairment and deferred tax payments, the company said in its statement. The new figures follow a halving of profits in 2009, then due to loan payment problems by customers hit by the economic crisis.

Fourth quarter profits also fell in 2010, to €321 million from €371 million, with some investors preferring to invest in the bond market, as well as higher provisions. The bank said it would pay a dividend of €0.03 per share, the same as the previous year.

In early trading in Milan UniCredit shares were up by almost one per cent on a market slightly down.

The Libyan state is the biggest shareholder in UniCredit with a stake of 7.582 per cent and Libya is represented on the bank’s board of directors. Earlier this week UniCredit said it had frozen a Libyan stake in the lender, worth an estimated €3.6 billion, following the adoption of European Union sanctions against the regime of Muammar Gaddafi.

The bank’s chief executive Federico Ghizzoni has promised stability following the dramatic ouster of his predecessor last year in a row over management.