Under the terms of the deal, UniCredit will pay $2.07 billion for a 95 per cent stake in Ukrsotsbank, as well as a capital increase of $130 million.
Commenting on the deal, UniCredit chief executive officer Allesandro Profumo said that he expected cost savings to accrue as Urotskbank is integrated into UniCredit's existing banking business in the Ukraine.
He added: "We expect to close the transaction in the fourth quarter of this year. We will have positive contribution from the group from year one."
UniCredit's other recent acquisitions have been Kazakh bank AFT and domestic rival Capitalia.
News of the acquisition comes as it has this week been reported by the Radiocor wire service that the merger between Unicredit and Capitalia could result in 5,000 job cuts.
Both Capitalia and Ukrotsbank had previously been takeover targets for Intesa Sanpaolo SpA.