MILAN (Reuters) - British hedge fund Caius has made a payment to UniCredit
Caius had questioned UniCredit's CASHES securities, arguing they should not be classed as best-quality capital.
"Caius intends to take no further public, legal or regulatory action in respect of UniCredit or its securities," the firms said in a joint statement.
"Without any admission of liability or wrongdoing, Caius confirms that it has also made a lump sum payment to UniCredit."
UniCredit had filed a lawsuit against Caius in August seeking 90 million euros (81 million pounds) in damages.
As a result of the settlement, whose terms are confidential, UniCredit said it had dropped its complaint against Caius.
Caius had asked for the around 3 billion euros in convertible and subordinated hybrid equity-linked securities issued by UniCredit in 2008 and known as CASHES to be converted into ordinary shares, which would have meant a big loss for holders of the instruments.
In July, the European Banking Authority (EBA) turned down Caius's request to open an inquiry into the CASHES, which UniCredit restructured in 2012 to comply with EBA's guidelines.
(Reporting by Valentina Za; Editing by Adrian Croft)