Before it will approve, in the night between the 22nd and the 23rd of December, the decree law 237 on the rescue of Monte dei Paschi di Siena, the government has woven a dense, negotiated with the european commission in Brussels. That has given a free way of maximum public intervention. But, now that the decree has been published in the Official Gazette, and it sets in motion the complicated procedure of “recapitalization prior”, in essence an injection of State money (it is assumed up to 7 billion to acquire the absolute majority of the bank and avoid bankruptcy), it is well to remember the constraints provided by the Eu rules. The european commission presided by Jean-Claude Juncker, who will need to authorize in the coming months, the basic steps of the procedure, poses in synthesis 4 conditions.
1) First of all, the european central Bank, through the Single Supervisory Mechanism (SSM), led by Danièle Nouy, will have to confirm the lack of capital of the Mps in the adverse scenario of the stress test. On this there will be no problems, since as early as last July 29, from the stress test, it was found that the Mps would have found to 2018 with a negative net equity, amounting to 2.2% to.
2) The public intervention to be accompanied by the “burden-sharing” against the shareholders and the bondholders are subordinate to it. It means that the help of the State, because of this it is, may only be authorised if the cost of the bailout to participate in the first instance, the shareholders and the bondholders subordinate, who then will suffer losses. You will save only the small investors the holders of the bonds, for which there is a mechanism of protection of investment. On the burden-sharing the review of Brussels will be severe. In particular, on the price of the conversion of the subordinated securities into shares.
3) The government must submit a restructuring plan of the Mount “credible”, says the commission, which put the bank in a security, excluding, in the future, other public interventions. In essence, the nationalization has to be temporary. Once healed, the Mps should be sold by the Treasury to the private sector.The plan, which will take in the vertices of the ministry since the next few days, will include thousands of redundant workers, and doors to be closed, over which a re-organisation of the disposal of “suffering”, that is, the € 27.7 billion of bad loans.
4) The government must ensure that State aid will not be used by Mps to make unfair competition to other banks. Verified the respect of these 4 conditions, Brussels will give the go-ahead. You may then spend a few month.
As we said in point 2, the commission allows the full protection of the small savers, but this is not covered in the conditions to give the ok on State aid to the Mount, but it is a question that pertains to the relationships between customers and the bank, must admit I cheated the first by selling them bonds with a risk profile which were not been adequately informed. The protection of these 40 thousand savers who have in hand bond of approximately 2.1 billion will take place, includes the decree-law, with the possibility of obtaining ordinary bonds (the safest of the subordinated) of the same nominal value. Are excluded from this protection, institutional investors (banks, insurance companies, mutual funds, pension funds and asset management companies), for which there will be only the conversion of the bond into shares equal to 75% of the nominal value of the bonds.
December 24, 2016 (change on December 24, 2016 | 15:05)
© REPRODUCTION RESERVED
No comments:
Post a Comment