All the new buboes in Monte dei Paschi di Siena
Towards new provisions in the balance sheet for Mps, while the Treasury is mobilizing to find a bank willing to take over Monte and the stock on the Stock Exchange continues to tumble. Facts, numbers, comments and indiscretions
More and more agitated waters not only in Siena but also in Rome on Mps. Here because.
An extraordinary board of directors of MPS is scheduled for Monday after the bank has decided to make additional provisions, estimated at 410 million euros, to face legal risks following the sentence of the former top management, Alessandro Profumo and Fabrizio Viola.
THE CASE OF PROVISIONS
The provisions, which will weigh on the nine-month accounts that the board of directors must approve on November 5, will further weaken the capital of the Sienese bank , for which rumors of a possible capital increase by the Treasury, the first shareholder with 68%, are chasing .
WHY THE TITLE ROLLS ON THE STOCK EXCHANGE
The hypothesis that MPS should launch a capital increase, thanks to the delicate situation on the front of the lawsuits, tumbles the stock to Piazza Affari, yielding 2.3%, settling at one euro.
WHAT THE BOARD OF MPS HAS DECIDED
But what did the Monte dei Paschi di Siena board of directors decide yesterday? Yesterday the board of Banca Mps decided to change the classification from “possible” to “probable” in relation to a series of legal disputes and out-of-court requests.
THE SANTORINI AND ALEXANDRIA DOSSIER
The decision follows the recent first instance conviction in Milan of the former leaders of MPS, Alessandro Profumo and Fabrizio Viola, for accounting in the financial statements of derivatives Santorini and Alexandria in past years. Rocca Salibeni, however, has not lifted the veil on any additional provisions that may have been decided. For Il Sole 24 Ore they are "a few hundred million euros".
THE BUG OF LEGAL CAUSES
Investors fear that MPS is forced to launch a new capital increase. Moreover, the legal and out-of-court disputes are substantial ( here the in-depth analysis of Start Magazine ): a stock of about 10.2 billion euros, which also hinders the possibility that the bank marries another institution, thus favoring the exit of the Treasury from capital, which – as promised to Europe – should take place by the spring of 2022.
WHAT THE SUN WRITTEN ON MPS
In the meantime, Il Sole 24 Ore argues, rumors about the bank's future are thickening related to the Treasury's desire to find a solution as soon as possible for a marriage, also in light of the need to strengthen the institution's assets as requested by the ECB to give the green light for the split of impaired loans in favor of Amco which will be effective at the end of November.
THE TREASURE MOVES FOR MPS
The Treasury already has the ammunition ready for the purpose: 1.5 billion inserted in the August decree which could be used to subscribe an At1 instrument. “However, a capital increase that would increase the recapitalizations made by Siena cannot be ruled out”, Il Sole writes today. Over the past 4 years, the bank has asked its shareholders for 18.5 billion.
HOW THE RECAPITALIZATION WILL TAKE PLACE
Equita notes that it is precisely through a strengthening of the capital, around 1.5 billion, that Banca Mps would improve its capital ratios. The operation, the experts of the SIM speculate, could be carried out 'through a plain-vanilla recapitalization on the market in which the Treasury would subscribe its share and any unexercised'. It could be carried out at the beginning of 2021, however, delaying any extraordinary operations such as a marriage with Unicredit, of which there is much talk.
THE EQUITA REPORT ON MPS
Obviously, the Equita experts underlined, given the size of the possible capital increase compared to the capitalization of the institute which is around 1.2 billion euros, it would create considerable pressure on share prices. Experts therefore recommend caution on shares ('Hold'), while calculating a price higher than the stock market prices and equal to 1.6 euros.
HERE ARE THE LEGAL BOMBS IN THE ACCOUNTS OF MPS. THE DEEPENING OF START MAGAZINE
MPS, THIS IS WHY PERFUME AND PURPLE WERE CONDEMNED
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/tutti-i-bubboni-del-monte-dei-paschi-di-siena/ on Fri, 30 Oct 2020 15:00:13 +0000.