Italy’s MPS approves €1bn share issue

Italy’s Banca Monte dei Paschi di Siena has won shareholder approval for a €1bn share issue needed to plug a capital shortfall in its balance sheet.

The bank will launch the cash call through the next three years and the foundation which controls the lender will not inject new resources into the bank.

Last week, the bank said it failed to meet capital targets set by the European Banking Authority which required to plug a capital shortfall by the end of June

In order to restore its losses, MPS is also planning to close 400 branches and cut 4,600 jobs, following the appointment of Alessandro Profumo as chairman in April.

MPS was particularly affected by the eurozone crisis, caused by the bank’s €25bn exposure to Italian government bonds.

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