Shareholders in Italian bank Credito Valtellinese approved on Saturday an issue of a convertible bond worth up to 625 million euros ($918.8 million) by June 30, 2010, under its capital strengthening plans.

The bond would be accompanied by up to 75 million warrants giving bondholders the right to take part in a new share issue which would boost the bank's capital by another 262.5 million euros, the bank said in a statement.

The bond convertible in Creval shares would have an indicative maturity of up to 42 months, it said.

The bond issue is part of Creval's programme to boost its capital strength which also includes an issue of so-called Tremonti bonds worth 200 million euros. The plan was approved by the bank's board in June.

The Tremonti bonds, named after Economy Minister Giulio Tremonti, are bought by the government and are meant to boost banks' capital strength to help them keep lending during the global credit crunch.

($1=.6802 Euro)

(Reporting by Svetlana Kovalyova; editing by David Stamp)