(Bloomberg) -- Banco BPM SpA will likely be among the buyers of a stake in lender Banca Monte dei Paschi di Siena SpA that’s being sold by Italy’s government, people familiar with the matter said.
The Italian state said Wednesday it’s selling a 7% holding in the lender, the latest step in an exhaustive restructuring drive that dates back to 2017.
A representative for Banco BPM declined to comment when contacted by Bloomberg. Italian daily Corriere della Sera previously reported on the possible interest in the Monte Paschi stake from Milan-based Banco BPM.
Italian media also reported that Banco BPM held an extraordinary board meeting on Wednesday.
The sale, through an accelerated bookbuilding, follows two other successful disposals that have progressively cut the Finance Ministry’s stake in Paschi.
After the deal closes, Italy’s holding in the Siena-based lender will drop to just below 20%. Banco BPM unit Banca Akros is acting as global coordinator and bookrunner in the placing.
Initial Disposal
An initial sale of 25% in Monte Paschi, in November 2023, allowed Italy to raise about €920 million ($973 million), a notable win for Prime Minister Giorgia Meloni’s government which has pledged to bring in about €20 billion from selling down Italy’s corporate holdings in a bid to slash debt.
The sale of an additional 12.5% in March brought in another €650 million.
Founded in 1472, Monte Paschi has recently undergone years of painful efforts to turn its business around. The bank was first bailed out in 2009 after it was hit by souring loans and derivatives deals that backfired.
Over the following decade it struggled to deliver consistent profit, and the bank was ultimately nationalized in 2017. A 2021 push by Italy’s previous government to combine the lender with UniCredit SpA fell through.
Finance Minister Giancarlo Giorgetti told Bloomberg last month that the state was ready to sell another stake before the end of this year, reiterating that Rome wants Paschi to be part of an overall consolidation move in the Italian banking sector.
Under Chief Executive Officer Luigi Lovaglio, Paschi has cut costs and shifted its focus to its most profitable businesses. Combined with a boost from higher interest rates, that allowed the bank to resume paying dividends last year.
Monte Paschi earlier this month posted better-than-expected results for the third quarter, driven by higher income from fees.
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