Exclusive-Italy, UniCredit set to call off talks over Monte dei Paschi-sources

Tajammul Pangarkar
Tajammul Pangarkar

Updated · Oct 23, 2021


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October 23, 2021

LONDON (Reuters) – Italy’s government and UniCredit are preparing to call off negotiations over ailing bank Monte dei Paschi (MPS) after efforts to reach an agreement over a costly recapitalization plan fell through, two sources told Reuters.

Rome has decided it won’t be able to meet UniCredit’s requests for a recapitalization package worth more than 7 billion euros as this would make a deal “too punitive” for the Italian taxpayer, one of the sources said. Disagreements over the size and costs of job cuts at the world’s oldest bank as well as an accountability issue over the way UniCredit calculates the fair value adjustments on MPS liabilities have proved to be a main stumbling block, this source said.

A second source said the parties had concluded it was impossible to reach an agreement based on the conditions set in July, which required the acquisition of “selected parts” of Monte dei Paschi to boost UniCredit’s earnings per share by 10% and leave its capital unaffected.

UniCredit declined to comment while the Treasury was not immediately available for comment.

(Reporting by Pamela Barbaglia in London, Valentina Za in Milan; Giuseppe Fonte in Rome)

Source Link Exclusive-Italy, UniCredit set to call off talks over Monte dei Paschi-sources

Tajammul Pangarkar

Tajammul Pangarkar

Tajammul Pangarkar is a CMO at Prudour Pvt Ltd. Tajammul longstanding experience in the fields of mobile technology and industry research is often reflected in his insightful body of work. His interest lies in understanding tech trends, dissecting mobile applications, and raising general awareness of technical know-how. He frequently contributes to numerous industry-specific magazines and forums. When he’s not ruminating about various happenings in the tech world, he can usually be found indulging in his next favorite interest - table tennis.