FILE PHOTO: The entrance of Monte dei Paschi headquarters in Siena, Italy, October 27, 2017. REUTERS/Stefano Rellandini/File Photo
MILAN (Reuters) – A small investment by Italian financial group Unipol in a local bank could put an end to the waiting game in Italian bank consolidation, aiding Rome’s efforts to finally cut its stake in ailing Monte dei Paschi (MPS).
Successive Italian governments have pushed healthier banks to take on struggling rivals to reduce the number of weak lenders in the country. But Italy has reached an impasse in trying to find a buyer for MPS, which it bailed out in 2017.
Bankers say Unipol’s surprise decision to raise its stake in tiny Banca Popolare di Sondrio to 9% over the past week could trigger a chain reaction that facilitates a solution for MPS.
The Treasury has long identified UniCredit as the best partner for MPS.
However a source briefed on the discussions with Treasury officials said new Unicredit Chief Executive Andrea Orcel would only consider a double deal where his bank would take over in stages both MPS and Italy’s third biggest lender Banco BPM. UniCredit declined to comment.
Banco BPM’s CEO Giuseppe Castagna, reluctant to be engulfed by a bigger lender, has been working to clinch a merger with smaller peer BPER Banca.