Italian PM Meloni Urges Against Breakup of Monte dei Paschi After Intesa Bid
Government Response and Implications for Italian Banking Sector
Background of the Monte dei Paschi Takeover Bid
MILAN, Aug 14 (Reuters) - Italian Prime Minister Giorgia Meloni hopes Monte dei Paschi di Siena (MPS) won't end up "dismembered" as a result of a takeover bid launched by the country's biggest bank Intesa Sanpaolo, she told financial newspaper Milano Finanza on Friday.
Bailed out by the state in 2017 and reprivatised in 2023-2024, in June MPS became the target of an unsolicited €36 billion ($42 billion) takeover bid by rival Intesa.
Government's Stance on Banking Competition
Meloni had repeatedly said in recent years the government wanted the use the reprivatisation of MPS to foster competition in the banking sector by helping the emergence of a third large player alongside market leaders Intesa and UniCredit.
Meloni's Comments on Government Involvement
"The government is not an active player in the banking sector. We were involved in part when we controlled MPS, which we inherited in a comatose state and restored back to health," Meloni said.
Significance of MPS and Concerns Over Its Future
She said MPS, the world's oldest bank with strong local roots, had become a prized asset.
"I hope current market dynamics can lead to an even stronger and more competitive system, to the benefit of households and firms. And I hope MPS will not be dismembered, losing its name and identity."
Details of Intesa's Plan and Market Reactions
Intesa's Proposed Actions
Intesa's plan envisages selling half of MPS branches, the Siena central offices and its brand to insurer Unipol Unipol, to be combined with Unipol-owned bank BPER.
MPS CEO's Response to the Bid
MPS CEO Luigi Lovaglio said last week he was studying bid defence options, noting that the breaking up of the commercial network would destroy value.
Wider Implications for Italian and European Banking
UniCredit's Position and Cross-Border Takeovers
Asked about UniCredit's hostile takeover of Germany's Commerzbank, Meloni said UniCredit, which already owns Munich-based HVB in Germany, should continue to have strong Italian roots
Meloni's Hopes for International Dialogue
"I hope a positive dialogue can be established between the bank and the German authorities," Meloni added.
Additional Information
($1 = 0.8657 euros)
(Reporting by Anna Uras; editing by Giselda Vagnoni and Valentina Za)
