Viola had threatened to resign last month after a shareholder meeting voted down his proposal to launch the 3-billion euro share issue this month.

The statement made no reference to Chairman Alessandro Profumo, who had also threatened to resign, but a source with direct knowledge of the matter said he too would stay in his job.

Italy's third-largest bank said its management would work towards carrying out a 3-billion euro ($4.11 billion) rights issue as soon as feasible and on the best possible terms, despite the cash call being postponed until at least mid-May.

The lender also expressed hope that its largest shareholder, a charitable foundation with links to local politicians, would sell its stake in the bank as quickly as possible. The stake sale by the foundation was the reason why the cash call was pushed back.

(Reporting by Silvia Aloisi, editing by Agnieszka Flak)