|Bid||1.6230 x 0|
|Ask||1.6270 x 0|
|Day's Range||1.5230 - 1.6340|
|52 Week Range||0.9855 - 2.6900|
|Beta (3Y Monthly)||0.80|
|PE Ratio (TTM)||15.21|
|Earnings Date||Aug 1, 2019|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||2.19|
Rating Action: Moody's upgrades the ratings of Class C and D notes in Siena Lease 2016-2 S.R.L. This is a cash securitization of lease receivables originated by MPS Leasing & Factoring S.p.A. (fully owned by Banca Monte dei Paschi di Siena S.p.A.) and granted to small and medium sized enterprises and individual entrepreneurs located in Italy. The upgrades are prompted by the increase in the credit enhancement ("CE") available for the affected tranches as a result of portfolio amortization.
(Bloomberg Opinion) -- Who knew there was investor appetite for subordinated Greek bank debt?Because of the relentless hunt for returns in yield-starved Europe, Piraeus Bank SA, one of Greece’s big four lenders, has been able to brave the European capital markets for the first time since the financial crisis.Piraeus isn’t opting for senior bonds, and is instead plumping for Tier 2 subordinated debt (which sits midway in the capital structure between top-rated debt and equity-like capital). This means the notes would be fully subject to investor bail-in rules, where bondholders take a financial hit should the bank fail.While the bank has been bolstering capital by offloading bad loans and selling assets, this issue will help it meet its commitments to the European Central Bank. Last year, the ECB asked the company to raise much as 500 million euros ($560 million) as part of its strategic recovery plan. It’s notable, nonetheless, that the lender has found plenty of takers despite all the well-known risks around the Greek banking system.Piraeus has raised 400 million euros from the 10-year subordinated security, with an issuer call option after five years. The very high 9.75% coupon was clearly attractive to buyers, but it carries danger signs too. Paying that much interest to bondholders will be a heavy burden for the bank’s business to support.Indeed, this might be a deal too far for wiser investment heads (regardless of all the hedge funds piling in here). Just because government yields are plunging doesn’t mean credit risk is improving; it usually means the opposite. In fairness, this issue is for bank capital specialists only but there’s always a deal that corrects the market’s over-enthusiasm for the diciest assets.The offer would have been unthinkable a year ago, and comes courtesy of a sustained decline in Greek sovereign yields, with five-year yields falling below their Italian equivalents, and a sixfold rally in Piraeus Bank's share price since February. It helps that imminent national elections are expected to deliver victory to the pro-business New Democracy Party. For Piraeus, it makes sense to strike now and the books were more than twice covered.Still, a big leap of faith is required to believe that that this ultra-high risk, CCC-rated junk bond will be repaid at that call date in five years time. Investors won’t want a repeat of what happened when Italy’s Banca Monte dei Paschi di Siena SpA issued a similar bond in January 2018. That now trades at close to half its initial value. Piraeus’s non-performing loans make up more than half of its total lending, despite its offloading of 500 million euros of them to private equity buyers this month. Even after the share price rally, the stock only trades at a price-to-book ratio of less than 0.2. The path to easing the bad debt burden will be arduous.As part of Piraeus’s strategic plan, the bank sees non-performing loans dropping to about 9% of the total by 2023, which requires the elimination of 21 billion euros of exposure. It has signed an agreement with Intrum AB, a Swedish debt collection specialist, to help manage its bad debt pile. However, the speed at which Greece’s lenders will be able to clean up their loan books is uncertain. The government and the Greek central bank have two separate, not entirely complementary, initiatives to help banks do this but they’re still obtaining European Union approvals.Piraeus’s plan to improve its fee income by 33% by 2023 looks ambitious too. As the biggest private lender to SMEs in Greece, its growth is tied ultimately to the country’s nascent economic recovery. A shareholder group that includes the EU-backed Hellenic Financial Stability Fund – as well as John Paulson, Vanguard, Blackrock Inc. and Schroders Plc – offers some reassurance. While success would be another important milestone in Greece’s long road to recovery, you’ll have needed nerves of steel to jump on this one.To contact the authors of this story: Marcus Ashworth at firstname.lastname@example.orgElisa Martinuzzi at email@example.comTo contact the editor responsible for this story: James Boxell at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Marcus Ashworth is a Bloomberg Opinion columnist covering European markets. He spent three decades in the banking industry, most recently as chief markets strategist at Haitong Securities in London.Elisa Martinuzzi is a Bloomberg Opinion columnist covering finance. She is a former managing editor for European finance at Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Italy's state owned Monte dei Paschi could merge with lenders of similar size although the list of candidates is thin, Chief Executive Marco Morelli said on Monday. "In theory Monte dei Paschi could be a merger partner for many banks, but the actual list (of candidates) is narrow", Morelli told Italian daily Il Resto del Carlino. The CEO added that another option was for the Italian Treasury, which owns a 68% stake following a bailout in 2017, to gradually reduce its stake.
Monte dei Paschi di Siena on Thursday reported an 85 percent drop in first-quarter net profit hurt by shrinking revenues and larger writedowns on problem loans due to Italy's weak economy, as well as some one-off hits. Monte dei Paschi was bailed out by the state in 2017 and CEO Marco Morelli is working to turn the bank around to comply with restructuring commitments agreed with European Union competition authorities and make it attractive for a potential buyer. Under the bank's 8 billion euro bailout, which handed Rome 68 percent of the world's oldest lender, Italy must submit an exit strategy to Brussels by the end of this year and bankers say turnaround efforts must bear fruit for a buyer to emerge.
ROME/MILAN (Reuters) - Troubled Italian bank Carige could need a larger-than-expected cash injection of at least 700 million euros (£607 million) under a rescue plan put forward by U.S. asset manager BlackRock, two sources familiar with the matter said. Temporary administrators appointed by the European Central Bank to run Carige are trying to find a buyer for Italy's 10th-largest bank by mid-May, after its top shareholder derailed an industry-financed rescue by blocking a 400 million euro cash call in December. A specialist fund run by BlackRock is the only known potential bidder although Italy's government stands ready to step in should a private buyer fail to clinch a deal.
SIENA, Italy (Reuters) - State-controlled Italian lender Monte dei Paschi di Siena always keeps in mind the potential for tie-ups with other banks, Chief Executive Marco Morelli said on Thursday. Speaking ...
VERONA, Italy (Reuters) - Italy's third biggest lender, Banco BPM, could be interested in tie-ups with banks close to its home turf in the north of the country, its CEO said on Saturday in comments that ...
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The European Central Bank in January launched an audit on Banca Monte dei Paschi di Siena to assess and manage the Italian lender's operating and legal risks, according to the bank's annual report. The audit on the Tuscan bank, which was bailed out by the Italian government in 2017 with a precautionary recapitalisation of 5.4 billion euros (4.6 billion pounds), is still ongoing, the report added.
European Union judges ruled on Tuesday that Italy's rescue plan for an ailing bank five years ago was legal, prompting calls for compensation for savers who subsequently faced stricter terms because Brussels had rigidly interpreted the bloc's rules. In a blow to EU antitrust regulators, the judges annulled a European Commission decision that rejected the Italian plan for Tercas and forced Rome to recoup financial aid to the bank. After the dispute with Brussels over the rescue of Tercas, Italian authorities intervened to help four other small banks in 2015 and then saved larger Banca Monte dei Paschi di Siena and two smaller north-eastern Italian banks in 2017.
Announcement: Moody's announces completion of a periodic review of ratings of Banca Monte dei Paschi di Siena S.p.A. Paris, March 13, 2019 -- Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of Banca Monte dei Paschi di Siena S.p.A. and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers.
Banca Monte dei Paschi di Siena S.p.A.'s (BIT:BMPS) released its most recent earnings update in December 2018, which indicated that the company finally turned profitable after losses on average overRead More...
The recapitalisation of Germany's NordLB bank should be investigated by the European Commission as it likely involved state aid that might have violated European Union rules, two EU lawmakers said on Tuesday. The lender, which has been struggling for years due to its exposure to the crisis-hit shipping industry, said in February that the German regional state of Lower Saxony and Saxony Anhalt had decided to go ahead with a recapitalisation, also backed by German savings banks. The intervention of the two states, which together own 65 percent of NordLB, effectively sidelined a rival offer by private equity groups Cerberus and Centrebridge.
Rome has suffered a long series of banking scandals, so it’s only fair to ask for more accountability. The coalition has nominated Paolo Savona, European Affairs minister, as the new chairman of Consob, the financial market regulator. At the same time, Rome has blocked a decision on renewing the term of Luigi Federico Signorini, deputy director general at the Bank of Italy.
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Italian banking service provider Nexi will hire 13 banks to run what could be Italy's biggest initial public offering in three years, sources with knowledge of the plan said. Bank of America Merrill Lynch, Intesa Sanpaolo's Banca IMI , Mediobanca, Credit Suisse and Goldman Sachs are set to be the global coordinators for Nexi's Milan listing, three sources said.
A top Bank of Italy official said on Wednesday he hoped that Banca Carige (CRGI.MI) could find a merger partner within a reasonable time and added the troubled bank had strengths which could benefit a potential buyer. Bank of Italy's Deputy Governor Fabio Panetta told a parliamentary hearing that a merger was the best solution for Carige, which faces a state bailout if it fails to find a buyer. The European Central Bank put Carige under special administration this month after its top shareholder blocked a planned capital raising in December.
MILAN/DAVOS (Reuters) - Popolare di Bari is studying a possible tie-up with other local mutual banks, two sources said, as the Rome government said it was keeping an eye on the situation at the troubled southern Italian lender. Popolare di Bari, which had 350 branches and 14.5 billion euros ($16.5 billion) in assets as of June, is under pressure to clean up its balance sheet and boost its financial strength but has said it has difficulties raising capital on the market. In an interview with Reuters, Economy Minister Giovanni Tria said the government was monitoring developments at Bari because there was a public interest in preventing banking problems from hurting local economies.
Italian Economy Minister Giovanni Tria said on Wednesday he sees no systemic threat from lenders Monte dei Paschi (BMPS.MI), Carige (CRGI.MI) or Popolare di Bari but is following developments. Troubles at Banca Carige, Monte dei Paschi and Popolare di Bari have reignited fears of wider instability in Italy's fragile banking sector, pushing the country's populist government to seek a long lasting solution. "It's three very different cases ... and none of them can entail a systemic crisis," Tria said in an interview with Reuters at the World Economic Forum in Davos.