UniCredit’s potential takeover of Commerzbank has drawn mixed reactions, with some calling it too aggressive while others believe it could help improve the competitiveness of European banks.

The Italian bank sparked speculation that it may launch a multibillion-euro takeover bid for Germany’s second-largest bank Commerzbank after it purchased a 9% stake in the bank.

It purchased half of the stake on the open market and the other half from the German government, which had unveiled plans to reduce its 16.5% stake, originally obtained during the financial crisis.

The move to become the largest shareholder was widely viewed as the first step towards a takeover bid.

UniCredit CEO Andrea Orcel justified the move as he said Europe’s banks are currently too small to cover the bloc’s funding needs, emphasizing the need for bigger, stronger banks to underpin the industry.

President of the European Central Bank Christine Lagarde agreed that cross-border banking mergers can be beneficial to creating large and more agile banks.

She added these mergers also align with the single market’s unity strategy, boosting the global competitiveness of European banks and enabling them to better compete with their US and Chinese counterparts.

However, German Chancellor Olaf Scholz described the potential takeover as an “unfriendly attack”, stating that hostile takeovers are not appropriate in Europe and not beneficial for banks, which is why the German government has clearly positioned itself in a direction to contend it.