* Mediobanca targets revenue growth to 3 bln euros
* CEO Nagel, under fire from billionaire, sticks to strategy
* Nagel does not rule out big M&A deal in wealth management (Adds quotes, details)
By Gianluca Semeraro
MILAN, Nov 12 (Reuters) - Mediobanca on Tuesday defied calls from its new top shareholder for the bank to return to its investment banking roots by outlining plans to expand its wealth management and consumer credit businesses.
The Italian bank's Chief Executive Alberto Nagel has come under attack from 84-year-old Leonardo Del Vecchio, a billionaire eye-wear tycoon who has built up a stake of just under 10% in the venerable merchant bank in less than two months.
Del Vecchio has criticised Nagel for relying too heavily on Mediobanca's consumer finance division and income from its 13% stake in insurer Generali and said Mediobanca should bolster investment banking.
Nagel said he would look for mid-sized acquisitions and did not rule out a larger deal in wealth management, which he said could be funded through a sale of the bank's stake in insurer Generali.
Under a new business plan to 2023, the bank also pledged to return up to 2.5 billion euros ($2.8 billion) to shareholders via dividends and share buybacks, up from 1.6 billion euros in the past four fiscal years.
Nagel said the bank had achieved "excellent" results in the past few years thanks to its diversification into consumer banking and wealth management and would stick to that strategy to raise revenues to 3 billion euros in 2023 from 2.5 billion euros now - a 4% annual increase on average.
"We are not in restructuring mode, we don't need to get rid of bad loans, we are not closing branches," Nagel told reporters, saying his bank's performance stood out in a sluggish sector.
"Despite the worsening economic outlook, negative interest rates and tighter regulation we see clear market opportunities in each of our three divisions."
Consumer finance is expected to remain the main revenue engine for the bank, contributing around 38% of total proceeds and growing on average 3% a year, with the network of branches expanding by 75% in the next four years.
Wealth management is seen as the fastest growing business in the plan, with annual growth forecast at 8% and a plan to expand the sales force by 60%.
Annual revenue growth in corporate and investment banking is forecast at 6% but wealth management will become the leading contributor to the group's fee income, Nagel said.
After a string of mid-sized acquisitions in recent years, he said wealth management was the only sector in which he would consider a big deal.
"If big opportunities arise, we have a lot of options - sell the stake in Generali and issue Mediobanca's shares to fund the transaction," Nagel said. But he said that "today there are no players available for this kind of operation."
Mediobanca's shares closed 2% higher, with market reaction seen as a key test for Nagel following Del Vecchio's swoop.
"We see the plan presentation as positive given the focus on improving existing business further, higher capital return and leverage on the group's key distinctive characteristics," Citi said in a note, citing a higher-than-peers return on equity, strong liquidity, low exposure to bad loans and sovereign risk.
One analyst, who spoke on condition of anonymity, said the targets looked feasible, but said that the dividend policy improvement might not be enough to please the market.
"One could have expected Mediobanca to be more shareholder-friendly," he said.
$1 = 0.9074 euros Additional reporting by Stefano Rebaudo, editing by Silvia Aloisi and Jane Merriman