NEW YORK (

TheStreet

) -- The head of Italy's largest bank is reportedly preparing to resign as shareholders and other protest his handling of an investment in the bank by a Libyan government-backed fund.

Unicredit

(UCG.MI)

boss Alessandro Profumo is "widely expected to announce his resignation Tuesday," according to a

report

in

The New York Times

citing local media.

The Libyan fund, which counts the country's central bank and the Libyan Investment Authority among its shareholders, holds a 7.2% stake in Unicredit. A disclosure by the bank Monday showed that stake increased by 0.5%, effectively making the Libyan government one of Unicredit's largest shareholders. That doesn't sit too well with other big Unicredit investors, including

BlackRock

(BLK) - Get Report

, Abu Dhabi's

International Petroleum Investment Company

, and several Italian banks, according to the report.

Profumo may be replaced temporarily by Dieter Rampl, Unicredit's chairman. Rampl has criticized Profumo's handling of the issue and called an "extraordinary board meeting" to address it, the report states.

--

Written by Dan Freed in New York

.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.