The surprise move is the latest amid a wave of consolidation in the country’s banking industry in recent months and would create Italy’s third largest entity in the sector.

Banca Monte dei Paschi di Siena SpA launched a €13.3 billion ($13.9 billion) all-share offer for larger rival Mediobanca SpA, as Italy’s banking consolidation heats up.

Italian bank Monte dei Paschi di Siena has announced it is launching a 13.3 billion euro takeover bid for larger peer Mediobanca in a surprise move that could reshape the country’s banking sector.