Who pushes (and who brakes) on the triangle Mps, Carige and Popolare Bari
Here is who and why is pushing (and who is holding back) for the merger between Monte dei Paschi di Siena (Mps), Banca Carige and Banca Popolare di Bari.
After the collapse of the Unicredit stock on the stock exchange, the bank's Board of Directors threw water on the fire on the hypothesis of the acquisition of Mps and a spokesman for the board of directors said that the bank in Piazza Gae Aulenti will not accept transactions that go to harm the interests of the group. Meanwhile, while on the one hand the scenario of a possible aggregation between the two banks at any cost fades, on the other hand another option for Monte dei Paschi di Siena appears: a three-way merger between Mps, Banca Carige and Banca Popolare di Bari, with the Ministry of Economy and Finance as the majority shareholder of the banking center. The secretary of Fabi, Lando Maria Sileoni, in order to avoid a "social butchery" went so far as to advocate the marriage of the three banks in difficulty, an operation that would be welcomed by the Deputy Minister of the Treasury, Laura Castelli (M5S). The Movimento 5 Stelle has long declared its opposition to the privatization of Monte dei Paschi di Siena.
WATER ON FIRE FOR UNICREDIT / MPS
After the collapse of Unicredit in Piazza Affari, which with the drops recorded between Monday and Tuesday lost about two billion in capitalization on the stock market, the board of directors of the bank in Piazza Gae Aulenti held back on the MPs hypothesis. A spokesperson for the Unicredit board thus made it known that the group "will maintain its current position on the growth and strengthening of its customer base, on the continuous transformation of the service model and maximization of productivity, on disciplined risk management and on rigorous management of its capital ". The bank then reaffirmed its support for the economy and the remuneration to shareholders, confirming "the restoration of the capital distribution policy, subject to the green light of the regulators, starting from the calendar year 2021". The Board therefore made it clear that in general it does not rule out mergers but that it will not pursue them at any cost. Meanwhile, the Government is advancing on tax incentives for M&A operations: the House Budget Committee has declared inadmissible the amendment of the M5S to reduce tax credits for banks that will join in 2021 to a maximum of 500 million.
HYPOTHESIS OF MPS / CARIGE / BARI MERGER
According to what was written by La Stampa, the contours of a complicated feasibility operation but well viewed in Siena, by the Deputy Minister (Cinque Stelle) of the Treasury Laura Castelli and already blessed by the leader of the banking union Lando Sileoni, are emerging: an aggregation between Mps , Banca Carige and Banca Popolare di Bari, three banks in difficulty. A merger that could later merge into a larger bank, and of which the Ministry of Economy and Finance would not sell the shares but would dilute while remaining the majority shareholder. This option would ensure the survival of MPS (which weighs over 10 billion in potential damages for lawsuits) in public hands. The Movimento 5 Stelle has long declared its opposition to the privatization of Monte dei Paschi di Siena.
THE DECLARATIONS OF SILEONI
Sileoni said that MPS “is a problem that neither the ECB, which demands stability, nor the Ministry of Economy, which wants to get rid of the responsibility of this institution, want it. Mps is a reference for the territories, starting with Tuscany. The position that the President of the Region will take within the Democratic Party will be decisive, as will the role of the 5 Stars. To avoid a social butchery – which would affect the provinces of Siena and Florence more – we proposed to put together the three weaknesses of the Italian banking sector: Mps, Carige and Popolare di Bari. If this project were to be envisaged, we will look very carefully at this initiative ".
AD BASTIANINI WORKING ON THE MPS / CARIGE / BARI PROJECT?
The project of the merger between the three troubled banks, reported in a recent article in La Stampa, is working confidentially CEO of Monte dei Paschi Guido Bastianini, who is writing – with the support of the advisor Oliver Wyman – a "stand alone plan ”Which was discussed in the board of directors on 2 December. On this last point, MF-Dowjones reported that in recent weeks the CEO Bastianini would have proposed to Mef, the first shareholder of Mps, a "stand alone" plan to allow the bank to be on the market alone beyond the deadline of 31 December 2021 identified by Europe for privatization. Monte dei Paschi di Siena would thus have more time to evaluate the direction to take.
THE COMMENT OF AN ANALYST ON MPS / CARIGE / BARI
While at the moment no reports have been released on the hypothesis of a merger between Banca Monte dei Paschi di Siena, Banca Carige and Banca Popolare di Bari, an analyst with whom Startmag spoke was very skeptical about this option. “It would be a sort of Italian Bankia”, the expert said only.
THE ECB'S THINKING ABOUT MERGERS
For the European Central Bank, mergers are better off if a strong bank buys a weak lender. Fabio Panetta, member of the Executive Committee of the ECB on 27 November declared that “some mergers and acquisitions give good results, others do not. Empirical evidence suggests that successful trades are those in which a strong buyer takes control of a weak broker. I don't know the details of the individual merger operations, but I believe that many cases fit this pattern ”.
MEF IS LOOKING FOR ANCHOR INVESTOR
It should be remembered that in the Mps report on the nine months of 2020, the Ministry of Economy and Finance reaffirmed, among other things, the intention to follow up on the commitments undertaken by the Italian Republic towards the European Union and carry out an operation market that identifies an anchor investor and / or a banking partner of adequate standing, in order to restore and ensure the competitiveness of the Sienese Bank. According to a source told Reuters, the Treasury would like to ensure a solution to the problems of Monte dei Paschi by the end of January.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/chi-spinge-e-chi-frena-sul-triangolo-mps-carige-e-popolare-bari/ on Thu, 03 Dec 2020 08:32:20 +0000.