Monte Paschi open to merger to avoid share issue - chairman

Reuters
Monte Dei Paschi bank headquarters is pictured in Siena
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Monte Dei Paschi bank headquarters is pictured in Siena January 25, 2013. REUTERS/Stefano Rellandini

MILAN (Reuters) - Loss-making Italian lender Monte dei Paschi di Siena (MIL:BMPS) is open to merging with a foreign or domestic rival to avoid a 2.5 billion euros (2.1 billion pounds) share issue but no talks are under way at the moment, Chairman Alessandro Profumo said in a newspaper interview on Tuesday.

"I cannot rule out anything. But what I can say is that for the time being no one has come forward," Profumo said when asked about the possibility of a merger with a foreign player.

"In general I say that if there are banking groups interested in (buying) 100 percent of the bank, we have the duty to examine any proposal," Profumo replied to a question about rumours of a tie-up with Italy's largest retail bank Intesa Sanpaolo (MIL:ISP).

Talk of a tie-up between the two banks were denied in September by a top executive at Intesa.

Bowing to European Union requests, Monte dei Paschi on Monday unveiled thousands of new job cuts and asset sale plans in a bid to return to profit and stave off nationalisation.

Monte Paschi, Italy's third-largest lender by assets, received 4.1 billion euros in special state loans earlier this year after the euro zone crisis and a derivatives scandal brought it to the brink of collapse.

(Reporting by Danilo Masoni; Editing by David Cowell)

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