Italy's Goal Is Several Big Banking Groups As It Works To Exit MPS - PM |

Italy’s goal is several big banking groups as it works to exit MPS – PM


Italy will work to exit the capital of bailed-out lender Monte dei Paschi di Siena (BMPS.MI) with a view to creating a banking landscape with several large groups, Prime Minister Giorgia Meloni said on Thursday.

Meloni said Monte dei Paschi had been “very badly handled” by previous governments leading to taxpayers spending billions of euros to prop up the Tuscan lender, whose restructuring however “appears rather solid.”

“We are working to ensure the state can exit in an orderly manner and, from my point of view, to create the conditions for Italy to have several large banking groups,” she told a news conference.

Italy owns 64% of Monte dei Paschi following a 2017 bailout that cost taxpayers 5.4 billion euros. Rome pumped another 1.6 billion euros into the bank as part of a 2.5 billion euro recapitalisation completed in November.

It sought in vain to sell Monte dei Paschi to UniCredit (CRDI.MI) last year, in a deal that would have helped UniCredit, Italy’s second biggest bank, bridge the gap with national champion Intesa Sanpaolo (ISP.MI).

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Sources have told Reuters the Italian Treasury remains open to resuming talks with UniCredit, though Banco BPM (BAMI.MI), the country’s third-largest bank, is also seen as a possible buyer for Monte dei Paschi.

Such a deal would boost Banco BPM’s footprint, possibly loosening the grip of Credit Agricole (CAGR.PA), a French bank which this year became the main investor in Banco BPM.

In an interview on Thursday Banco BPM CEO Giuseppe Castagna said Monte dei Paschi was “too big a mouthful” for his bank to swallow.

Castagna runs for reappointment in April and is expected to bide his time on any potential M&A move until he gets a new mandate.

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