Staff and management at Banca Intesa and Banca Commerciale Italiana (BCI) in Milan are voting with their feet, as the structure of their merger, announced last April, has yet to emerge.
The merger of the banks' wholesale and investment banking divisions, which will create Italy's largest banking group in terms of assets, is expected to result in the loss of up to 8,000 jobs. But as details of the deal fail to materialise, bankers from both sides are leaving in droves.
The head of investment banking at an Italian rival, who declined to be named, said that the departures could be significant. "A substantial number of people have left, which suggests there are some problems involved in structuring this merger," he said.
The defections could not have come at a worse time, he added, as domestic banks are all looking to create strong teams to face increasingly stiff competition from big international players.
Among the most significant defections has been Fabio Arpe, general manager at Intesa's securities and investment house Caboto, who left in July to become head of investment banking at rival Euromobiliare.
Arpe, who was said to have been disappointed not to have been appointed head of the combined investment banking division, took about 30 people with him, including derivatives, bond and investment banking specialists.
Three members of Caboto's securitisation team followed after being poached by Credit Suisse First Boston. And it is not just Caboto executives that are being targeted by rivals and headhunters.
BCI's asset management team has also been losing members. Fabio Carniol, who was responsible for institutional asset management, has gone to online trading and banking company Fineco Investimenti.
Some of his colleagues have been hired by mobile phone company Andala, and the fund management unit of Rolo Banca, which belongs to the UniCredito Italiano group.
Last week a new board for the merged bank was appointed, but no details about key executive appointments was revealed.