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UniCredit CEO says in talks with Intesa over restructured loans

MILAN, Feb 11 (Reuters) - Italy's top two banks UniCredit and Intesa Sanpaolo are discussing plans to deal with their restructured loans, the head of UniCredit said on Tuesday, as the banking system strives to tackle its large stock of problem loans.

CEO Federico Ghizzoni confirmed ongoing talks on restructured loans with Intesa, after a source said last week the two banks were in contact with U.S. fund KKR about setting up a vehicle to hold some of their restructured loans.

Ghizzoni did not give any details but said a decision had to be taken by mid-2014.

He said he had not discussed the option of a systemic "bad bank" to hold lenders' bad debt with Prime Minister Enrico Letta and had not heard any talk concerning this or the possibility of public guarantees to help bank offload bad debt.

"These could perhaps be solutions that are useful for banks with a different size (than ours), we think we can manage on our own. If there are any proposals we will listen to them," he told journalists.