Italy's Treasury defends its actions as bailed-out Monte dei Paschi faces judicial probe

MILAN, Nov 29 (Reuters) - Italy's economy ministry on Saturday said it had acted properly in placing shares in bailed-out bank Monte dei Paschi di Siena (MPS) with two key investors who are now at the centre of an investigation by Milan prosecutors.

"The ministry always acted in compliance with rules and standard practices," a Treasury official said.

Italy's MPS, its chief executive and its top two shareholders are facing an investigation in Milan in relation to the Tuscan bank's takeover of Mediobanca, judicial sources told Reuters on Thursday.

Prosecutors have been looking into whether the two investors and the bank acted in coordination while keeping supervisory authorities and investors in the dark.

MPS and the two shareholders, Italian tycoon Francesco Gaetano Caltagirone and holding company Delfin, have denied any wrongdoing and expressed confidence the investigation will exonerate them.

After bailing out MPS in 2017, Italy in November 2023 started re-privatising the bank by placing blocks of shares on the market to cut its 68% holding, in line with commitments taken with European Union authorities.

The final placement took place in November 2024 and brought onboard as shareholders Caltagirone and Delfin, alongside mid-sized bank Banco BPM and fund manager Anima.

Caltagirone and Delfin told markets watchdog Consob they had been sounded out by the ministry ahead of that sale in relation to a plan by the Treasury to create a core of more stable domestic shareholders in MPS, a judicial document reviewed by Reuters showed on Saturday.

The first two share placements brought in as shareholders dozens of international investment funds.

The judicial document showed the ministry told Consob there had been no previous contacts with the investors that took part in the November 2024 placement.

That sale cut the Treasury's stake in MPS below 12%. The Mediobanca deal reduced it further below 5%.

(Reporting by Giuseppe Fonte and Emilio Parodi; Writing by Valentina Za; Editing by Andrew Heavens)