Bank: Rome negotiates the resale of BMPS with UniCredit

Posted on Jul 29, 2021, 9:51 p.m.

They’ve been around for over six months but things are coming to fruition. The Italian government has entered into “exclusive” negotiations with Italy’s second largest bank UniCredit to sell it its stake in Banca Monte dei Paschi di Siena (BMPS). The discussions were formalized in a statement from the bank. The day before the publication of the results of the ECB’s stress tests …

The Italian state was looking last year for a lessee for the 64% stake it holds in BMPS following the public rescue in 2017 of the oldest bank in the world still in activity. This announcement contrasts with the signal sent recently by Andrea Orcel, CEO of BMPS. In a letter to his employees, he had given priority to the rationalization of the company to any movement of consolidation.

Better form

But restructuring of the transalpine banking sector has accelerated since Intesa San Paolo, the country’s leading bank, bought out rival UBI last year. The state is also under pressure from the ECB to let go of its securities.

Finally, BMPS which had planned at the end of 2020 a strong capital increase of 2.5 billion euros before any marriage to restore health after the health crisis is also less badly than expected. The bank recorded a net profit of 120 million euros in the first quarter, compared to a net loss of 240 million in the same period last year.

There is no shortage of subjects for the two negotiators. In addition to tax relief measures to facilitate bank mergers, the Treasury is considering a way out of the legal risks of BMPS before it joins another entity. The bank’s shareholders, weary of years of mismanagement, have taken legal action and are demanding 10 billion euros in compensation.

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