The Italian state is privatizing twenty percent of the world’s oldest bank, Monte dei Paschi di Siena (MPS), Bloomberg learned from the Italian Ministry of Finance’s announcement on Monday.
The bank, founded in 1472, has struggled with serious problems in recent years, and had to be bailed out with a rescue package in 2009 and 2017 due to non-performing loans, when the state acquired a stake in it for 5.4 billion euros.
However, according to the agreement reached at that time, the state must part with its ownership over time – as part of this plan, Italy now wants to sell 20 percent of the bank by issuing 252 million shares.
Last month, Prime Minister Giorgia Meloni started the process of selling the bank by inviting consultants to try to maximize the value of the part remaining in the hands of the state. The Italian state currently owns 64 percent of the bank.
It has tried to sell the state’s majority ownership before, two years earlier the previous Italian government wanted to get rid of the bank by merging MPS and Unicredit SpA, without success. Finally, a new CEO was appointed, who in two years made the bank more attractive to investors.