Italy plans to sell its Monte Paschi stake by 2021

Italy is committed to selling its majority stake in Banca Monte dei Paschi di Siena SpA by 2021, according to a report in Il Sole 24 Ore.
The Italian government led by Prime Minister Giuseppe Conte plans to send a letter soon to the European Commission and the EU Competition Authority reiterating it will gradually exit its 68.2% stake in the world’s oldest bank, Il Sole 24 Ore reported, without citing anyone.
The state’s plan is to find buyers and eventually combine it with another bank. Earlier this year press reports talked of Unione di Banche Italiane SpA and Banco BPM SpA as potential merger partners for Monte Paschi.
At stake is the approximately €5.4bn ($6bn) Italian taxpayers contributed to rescuing Monte Paschi as well as the Siena-based lender’s future as a viable private institution. Italian officials also have to make sure that any exit plan doesn’t run afoul of European Union rules against state aid for troubled financial companies. Under the rules of the bank’s EU-approved bailout, the state is required to provide an exit plan this year and dispose of its holding by 2021.
Monte Paschi has significantly improved its balance sheet and lowered costs by cutting thousands of jobs and closing branches under chief executive officer Marco Morelli’s turnaround plan. Bad loans accounted for 15% of the total as of June, down from a peak of more than 30%.

from Gulf Times https://ift.tt/2Q983M4