| Author (Corporate) | European Commission: DG Communication |
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| Series Title | Press Release |
| Series Details | IP/17/1905 (04.07.17) |
| Publication Date | 04/07/2017 |
| Content Type | News |
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Further information: The approval of state aid in the amount of €5.4 billion for a precautionary recapitalisation of MPS followed the agreement in principle reached on 1 June 2017 between the European Commissioner for Competition and Italy's Minister of Economy and Finance on the restructuring of the bank. The two conditions for this agreement were eventually both fulfilled. In particular, the European Central Bank confirmed that MPS is solvent and meets capital requirements, and Italy obtained formal commitment from private investors to purchase the bank's non-performing loan portfolio. Background: Banca Monte dei Paschi di Siena (MPS) is the fifth largetst bank in Italy. Following the European Banking Authority's EU-wide stress test in 2016, this bank stood out as the worst performer among all scrutinized banks. As a result, the MPS had to discuss a capital plan with the ECB and announced at the same time that it would seeks to raise €5 billion from investors, alongside a disposal of bad loans. This operation failed after the outcome of a referendum in Italy on constitutional reforms, leading the bank to the announcement that it would ask for a precautionary recapitalisation from the Italian government in December 2016. The European Commission approved on 4 July 2017 Italy's plan to support a precautionary recapitalisation of Italian bank Monte dei Paschi di Siena (MPS) under EU rules, on the basis of an effective restructuring plan. |
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| Source Link | Link to Main Source http://europa.eu/rapid/press-release_IP-17-1905_en.htm |
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| Subject Categories | Business and Industry, Internal Markets |
| Countries / Regions | Europe, Italy |
