UniCredit SpA will freeze the rights of Libyan shareholders, the largest combined stockholder bloc, in light of European Union sanctions, the Italian bank said Friday.

The Central Bank of Libya owns almost five per cent of UniCredit, Italy's biggest bank, and its chief is a vice chairman of the bank. The Libyan Investment Authority holds a 2.6 per cent share.

The EU added five financial institutions, including the Central Bank of Libya and the Libyan Investment Authority (LIA) to its sanctions list on Thursday in a move to force out Libyan leader Muammar Gaddafi.

"In light of the resolutions by the EU published today, UniCredit announces that — with regard to is Libyan shareholders — the exercise of the rights attached to the relevant shares will be frozen in compliance with such resolutions," UniCredit said in an e-mailed statement.

Italy has extensive business and investment ties with Libya, with oil company Eni the biggest foreign operator in the North African country.

Among other holdings, LIA has a 2.01 per cent stake in defence and aerospace company Finmeccanica SpA. The Libyan Arab Foreign Investment Company holds less than two per cent of automaker Fiat SpA and 7.5 per cent of Juventus soccer club.