The source said no final decision had yet been taken. UniCredit declined to comment.
The source said the bank was considering pricing new shares at between 1.2 euros and 1.3 euros each.
“It’s a possibility that’s being studied,” the source said.
The stock fell 2.7 percent to 2.608 euros by 0838 GMT with traders saying sales had been triggered by Il Messaggero daily, which first reported details of the share issue pricing.
A second source close to the matter said UniCredit could launch the share issue soon after it approves full-year results on Feb. 9.
(Reporting by Gianluca Semeraro and Valentina Za, editing by Stefano Bernabei - Reuters)