Italy's Ministry of Finance approves decree on the sale of Monte dei Paschi: Sources

© Reuters. FILE PHOTO: A sign for the Monte dei Paschi Bank can be seen in Rome


By Giuseppe Fonte

ROM (Reuters) – Italian Economy Minister Roberto Gualtieri has signed a government decree listing options to sell Italy's majority stake in Monte dei Paschi di Siena (MI :), two pertinent sources told Reuters.

Rome saved Monte dei Paschi in 2017, spending 5.4 billion euros on a 68% share to be sold next year as part of the rescue package negotiated with the European Union's competition authorities.

Gualtieri's signature paves the way for final approval from Prime Minister Giuseppe Conte, the two sources said, demanding not to be named because of the sensitivity of the matter.

The Italian Ministry of Finance declined to comment.

Although Italy's co-ruling 5-star movement wants the state to delay its exit from Monte dei Paschi, sources have told Reuters that the Treasury Department is working to find a buyer by the end of the year.

The aim is to combine a merger with a complex system in order to free the bank from its remaining problem loans.

While Banco BPM (MI 🙂 is seen as a good partner by the Ministry of Finance, the Milan-based bank has repeatedly denied any interest in working with Monte dei Paschi.

The decree received from Reuters authorizes the Treasury Department to help Monte dei Paschi, through a contract with the state bad loan manager AMCO, to reduce € 8.1 billion in problem debt.

This cleanup "is essential to give the bank the prospect of a permanent return to profitability … and pave the way for the Department of Commerce to sell its stake," the decree says.

Rome also lists ways the government can liquidate its stake, including an offer of shares, a public tender, or negotiating a merger.

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