Free way of the Ecb to rescue a private of the Mps. The bank: “there is No plan B to the capital increase” – The Republic

MILAN - the Eve of the shareholders ‘ meeting for the Monte dei Paschi, that on the 24th of November, encourages members to propose the recovery plan passes through a maxi disposal of non-performing loans and a capital increase of up to 5 billion. After the days of the passion, also to the risks (dispelled) that do not reach the quorum of 20% for the shareholders ‘ meeting in Siena, signals come and more comforting, at least to enter the path that in a couple of weeks will determine whether the tuscan bank may risanarsi with the resources of the market or will need other solutions.

The Ecb has still given the go-ahead for the rescue operation, approved the industrial plan on October 25. He informed the Mps, in conjunction with the free way also of the Bank of Italy, which has “successfully completed the procedure of assessment on the statutory modifications for the purposes of the operation”. That is based on the voluntary conversion of the bond is subordinated, up to 4.3 billion, together with a recapitalisation of up to 2 billion in the Stock market and the entrance of new partners for the estimated 1.5 billion: all funds to fill the deficit that will be produced from the sale of the 27 billion of non-performing loans, context of the operation.
moreover, a plan B to put in axis bank the oldest bank in the world, at least officially, does not exist. In the integration to the documents of the meeting request from the Consob, in fact, the bank writes do not have to study a “plan B” in case the rescue plan for private fails. “ The Bank states that, to date, not to study alternatives”, we read in additions to the documents prepared to give more information to shareholders called to vote on the project.

what is certain is that in the last hours have received proxies sufficient to overcome the obstacle of the 20% of the share capital, which makes the meeting valid for voting to strengthen the balance sheet: at least the issue of the quorum is no longer on the table, while among the shareholders are withdrawn, the shareholders and will be controlling the moves of the foreign funds.

From the documentation filed, there are other details, for example, that the save operation of the Mps has a gross cost of euro 448 million: all costs, with the exception of a small residual amount, will be paid only in case of success of the operation. The Junior tranche of the securitization, allocated free of charge to the shareholders of the bank, has a nominal value of 1.583 million but a fair value, calculated on preliminary estimates, 427 million. The fair value of the junior tranche, a sort of reward for the members of the Mps, is “currently the subject of evaluation by an expert outside”, where the assessment “may differ” from the one that emerges from the estimates. Continuing the theme of non-performing loans, the Mount explains that, where the cleaning operation of the budget from non-performing loans had already been made before the 30th of September last, the institute would have closed the first 9 months of 2016 with a red 4.185 million.

The papers confirm that “there are several weeks inspections” by the european regulator. The Ecb, it reads in integrations requested by Consob, “send a team inspection at the financial institutions it regulated, according to defined plans annually for each bank. Activities are going on regularly in the spirit of collaboration that characterizes the relationship between Mps and the Ecb”.

As to the success of the conversion operation of the 4.3 billion bond subordinated shares, to November 21, the Mps expected a membership for a nominal value of 1,057 million euros, equal to about 25% of the total nominal (4.289 million) of securities that are the subject of the proposal.

Topics:

Mps

capital increase Mps

Italian banks

bond subordinated

ecb

Italy

Starring:

Mark Morelli