Exclusive-Italy open to selling down MPS stake on market if terms, buyers are right - sources

3 weeks ago 53

ROME, May 5 (Reuters) - Italy's Treasury is open to reducing its 64% stake in Monte dei Paschi di Siena (MPS) (BMPS.MI) through one or more share sales on the market, three people briefed on the matters told Reuters.

Such an option, however, would only be considered if financially advantageous and as long as any significant new investor would manage the holding in line with the national interest, one of the sources said without elaborating.

Commitments taken with the European Union at the time of the bank's bailout in 2017 bind Italy to eventually selling out of MPS and any significant co-shareholder in the bank could play a role in aiding or hindering the Treasury's exit strategy.

MPS declined to comment.

After rescuing MPS at a cost of 5.4 billion euros ($6 billion) for taxpayers, Rome pumped another 1.6 billion into the Tuscan bank last November when it covered 64% of a 2.5 billion euro capital raise.

Shares in MPS are trading back in line with the price of 2 euros each at which it sold new shares, having risen to as much as 2.85 euros in late February shortly before French shareholder AXA (AXAF.PA) sold the 8% stake it had acquired in the new share issue.

MPS had to raise fresh capital to fund staff exits and replenish its capital reserves after the Treasury failed to clinch a sale of the bank to UniCredit (CRDI.MI) in 2021.

Banking supervisors still see a merger with a stronger peer as the best option for MPS, but both UniCredit and smaller peer Banco BPM (BAMI.MI), which the Treasury has long identified as the most suitable merger candidates, have repeatedly denied any interest.

Prime Minister Giorgia Meloni said several times that MPS's privatisation should foster the creation of several large banking groups in the country.

($1 = 0.9081 euros)

Reporting by Giuseppe Fonte in Rome and Valentina Za in Milan; Editing by Susan Fenton

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