The Italian Treasury is set to become Banca Monte dei Paschi di Siena (MPS)’s major shareholder starting from July, according to local press.
The move comes from MPS’s duty to repay interest payments on state loans, worth €243m in 2014, in shares should a capital loss occur.
Given the Tuscan bank’s recent record loss of €5.3m, it will have to pay coupons back to the Treasury in shares.
The announcement made the bank’s shares go up by 13% to €0.485 last Friday, according to Il Sole24ore.
If the deal had taken place according to last Friday’s market price, the Treasury would have ended up owning some 10% of MPS.
However, that share is expected to go down to some 5% after the capital increase of €3bn, which is due to be completed by May, MPS said.
MPS’s asset management activities have been seeing significant outflows in recent years, the latest of which came at €127.8m, according to Assogestioni’s data.