The announcement of the agreement on the merger does not spare to Banco Popolare and BPM strong sales at the Milan Stock. The Tour gives 2.95% and BPM 2.89% compared to an industry index FTSE Italy Banks losing only 0.38 percent. It therefore appears that the wait operation has sparked immediate enthusiasm.
At this time the two groups of managers are telling the market The next birth of the third Italian bank , but from this morning’s notes and the slides of the conference call in progress can already take the basic elements to draw a picture of the whole. The note last night, branched at the end of the meetings of the boards of directors of the group led by Pier Francesco Saviotti and one led by Giuseppe Castagna, it designs the birth of an operator 2,500 branches with a share market more than 8% and leadership in Lombardy (first by market share), Veneto (3rd) and Piedmont (3rd). Projected to reach 4 million customers of the new entity will be active, as well as in traditional commercial banking services in Asset Management, Private Banking, Corporate & amp; Investment Banking, Bancassurance and Consumer Credit.
Managers link to synergies of 365 million Euros by 2018 . Around 290 million euro will come from cost synergies and the rest from revenue synergies. But they are scheduled integration costs a grant equal to 150% of cost synergies by merging cost about 435 million euro .
In the new groups Tour members will have 54% and BPM current shareholders will have 46% . Is particularly confirmed a capital increase by one billion Euros by Banco Popolare to execute before the green light of the shareholders in the merger expected by November 1 and effectively within the year.
The new big credit will head office in Verona and home office in Milan .
The agreement also provides for the unbundling of the network of branches of BPM and Banco same institute in the historic provinces of Piazza Meda ie Milan, Monza and Brianza, Como, Lecco and Varese . The spun-off company with this network will have both legal and administrative headquarters in Milan, but it will be coordinated by the parent company. This is basically the Milan wing victory that had asked three years of autonomy to BPM: the spun-off network will still be incorporated into the new parent company from the third year following the effective date of the merger. Failure execution of the Capital (or the failure to complete conversion into ordinary shares in the event of use of financial instruments being converted) by October 31, 2016 constitutes termination clause of the Memorandum of Understanding.
Also confirmed by the leaked governance scheme in these days of comparison with the integration ECB. There will be a board of directors and a board (traditional and non-dual governance as BPM) consists of 19 members . At least 9 directors will be independent. After three years the board of directors will be reduced to 15 members (at least 7 independent).
Also Confirmed Joseph Castagna (current to BPM) as CEO , other 9 of the board members will be from the Tour , among them the president Carlo Fratta Pasini and two vice-presidents. Seven members will come instead from the BPM , among them the vice-president vicar. The remaining two will be independent selected by mutual agreement. It ‘also confirmed that Pier Francesco Saviotti, present to the Bank, covers the positions of chairman of the executive committee made up within the board of directors with 6 Administrator (including the to the deputy chairman, Vice-Chairmen of the board and a sixth component from those nominated by BPM).
Also confirmed the basic aspect of providing for a Limit the exercise of vote per shareholder in 5% of the capital effective until the period prescribed by the cooperative banking reform, namely to 26 March 2017.
‘ capital increase of one billion euro scheduled for the Tour and will be submitted to shareholders by May conditions of the merger outcomes. A precise path for it so you might configure an offer of option rights or (alternatively or concurrently) the issue of convertible bonds to be converted before the next green light of the shareholders in the merger has not yet been defined. If you consider that the Banco worth on the stock market today around 2.6 billion euro, it is understood that the new requirements for members are not indifferent.
The managers have already signed, in any case, a Pre-underwriting agreement with Mediobanca and Bank of America Merrill Lynch , therefore, ensure that in any case the subscription of any shares of ‘capital increase unopted. Some other number can definitely benefit the evaluations.
‘ the new group will be of 171 billion euro . The Direct deposits will be 120 billion and the Indirect of 105 bln. The applications will be about 113 billion euro.
The new group, whose name is yet to be decided will have a CET 1 ratio pro-forma phased in at 13.7% (13.6% phully loaded). L ‘ LCR pro forma exceed 100 percent.
As for doubtful there is a rapid strengthening of the shell, a reduction in pain level, a differentiation of the credit portfolio and the creation of an ad hoc organizational unit that will deal of using and management of the same sufferings. The slides today offer on this subject a few more details. You may notice that in the counting of suffering and impaired loans are included excerpts which obviously have a weight in the overall count. The ratio of non-performing loans (with excerpts) on the new group’s loans will be 24.8% (NPL Ratio Nominal, while gross loans without excerpts will be 21.8% and net without excerpts to 15.7%). E ‘will be a cutting nominal impaired loans up to € 10 billion by 2019 .
(GD)
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