(CNN) -- A European banking union is crucial to eliminating the eurozone's debt crisis, according to the boss of Italy's largest bank.
Federico Ghizzoni is chief executive of Milan-based UniCredit and says his bank will emerge stronger from the euro area's crisis. He told CNN: "The crisis is pushing everybody to realize that it is time to make a change."
A proposal by European politicians to set up a "banking union" for over 6,000 eurozone banks is intended to prevent a recurrence of banking crises such as those suffered by Ireland and Spain.
Under this proposal, the European Central Bank would take on the role of regulator and Ghizzoni said: "It is an important step forward, to try to eliminate the imbalances inside Europe."
Some countries, including Germany, are opposed to relinquishing control over smaller public-sector banks and want any union to extend only to Europe's biggest financial institutions.
But Ghizzoni says the debt crisis is an opportunity for Europe to forge closer ties through both fiscal and banking integration. He said: "I am in great favor [of having] the European banking union apply to all banks, not just systemic banks."
The 56-year-old took over as CEO of UniCredit in September 2010, just months after the full extent of Greece's debt crisis emerged, and two years after the collapse of Lehman Brothers.
The bank is based in Italy, which is undergoing a harsh program of austerity to try and tackle its debts of almost 2 trillion euros ($2.5 trillion).
The country's difficulties have been a "really serious problem," Ghizzoni said.
But being established as a European bank in 22 countries is a big help. "UniCredit is not just an Italian bank, only 38% of our assets are based in Italy.
"We have 27% of our assets based in Germany, for example."
Ghizzoni said the crisis has ensured the bank streamlined its processes -- which brought it closer to customers. In turn, that boosted its deposit base.
"Thanks to a very good relationship established with our customers, our deposits keep growing. I saw the numbers recently and this is a great comfort to us," he said.
Ghizzoni added: "If I look at the bank from a capital point of view, we are okay. But more importantly for me I can say we are good from a liquidity point of view."
CNN's Oliver Joy contributed to this report