MILAN, Dec 1 Reuters Italy39;s secondbiggest bank UniCredit said on Thursday it had repurchased 1 billion euros39; 1 billion worth of its own shares, meeting its payout goals for the year.

UniCredit gained supervisory approval for the second buyback in September, when the European Central Bank judged its capital buffers sufficiently robust to withstand a reduction as Europe39;s economy heads towards a recession.

But since then the economic outlook has darkened and the ECB has stepped up scrutiny of banks39; payout plans to make sure they take properly into account recession risks.

Supervisors are concerned that banks39; risk models are ill equipped to process the threat from inflation and that the models could also be affected by governments39; COVID19 support measures which have kept default rates low in the past two years.

UniCredit39;s latest buyback, which represents 4.3 of its capital, will reduce the number of its shares thereby boosting earnings per share.

It had done the same after repurchasing 7.4 of its capital with a first buyback earlier in the year.

CEO Andrea Orcel, after walking away from a possible takeover of Monte dei Paschi di Siena to boost UniCredit39;s domestic market share, has bet on capital distribution to drive the bank39;s share price higher.

A year ago he pledged to return more than 16 billion euros to investors in dividends and share buybacks by 2024, starting with 3.75 billion euros over 2021 results.

In presenting thirdquarter…