Bloomberg News

Monte Paschi Postpones Board Meeting on Business Plan to June 26

June 24, 2012

Banca Monte dei Paschi di Siena SpA, Italy’s third-biggest bank, postponed by a day to June 26 a board meeting to approve a business plan, including measures on capital to comply with European Banking Authority targets.

Monte Paschi delayed the meeting for “organizational reasons,” the Siena, Italy-based bank said in a statement yesterday. The bank will present the plan to investors on June 27, it said.

Monte Paschi, among Italian lenders that must raise capital as part of Europe’s plan to end the sovereign-debt crisis, has a capital shortfall of 3.3 billion euros ($4.4 billion), according to the European Banking Authority. The bank has also to repay 1.9 billion euros of state aid provided in 2009.

The lender has already covered more than 2 billion-euro of its shortfall through the conversion of hybrid bonds and the implementation of new internal models, Chief Executive Officer Fabrizio Viola said last month. The bank may fill the remaining shortage of capital through asset sales and the issue of contingent convertible bonds, he said.

Monte Paschi is also considering asking for new state aid, through the issue of 1 billion euros of bonds subscribed by the Italian Treasury, Il Sole 24 Ore reported June 19.

Monte Paschi’s first-quarter profit dropped 61 percent to 54.5 million euros after setting aside more money for bad loans, it said May 15. Loan-loss provisions in the quarter rose 58 percent to 434 million euros.

To contact the reporter on this story: Sonia Sirletti in Milan at ssirletti@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net


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