Finance
Monte Dei Paschi Investors Vote to Settle CEO Contest
Published by Global Banking & Finance Review®
Posted on April 15, 2026
3 min readLast updated: April 15, 2026
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Published by Global Banking & Finance Review®
Posted on April 15, 2026
3 min readLast updated: April 15, 2026
Add as preferred source on GoogleMonte dei Paschi shareholders vote April 15 amid a boardroom showdown between ousted CEO Luigi Lovaglio and Fabrizio Palermo, chosen by the outgoing board. The vote could influence the pending Mediobanca integration and broader Italian banking consolidation.
By Valentina Za
SIENA, Italy, April 15 (Reuters) - Shareholders in Monte dei Paschi di Siena vote on Wednesday to decide a boardroom battle pitting ousted boss Luigi Lovaglio against a rival CEO candidate picked by the bank's outgoing directors, Fabrizio Palermo.
The CEO contest at Monte dei Paschi (MPS) could shape the next phase of consolidation in Italy's banking sector, as Lovaglio has repeatedly said he was preparing for further mergers and acquisitions by the bank.
Rescued by the state in 2017 and re-privatised in 2023-2024, MPS last year took over Mediobanca to become the main investor in insurance group Generali, a trophy asset in Italian finance.
Lovaglio fell out with other directors and with leading MPS and Generali shareholder Francesco Gaetano Caltagirone after securing board approval for the plan to merge Mediobanca into MPS, sources have previously told Reuters.
Caltagirone has denied any direct clash with Lovaglio, saying the disagreements are within the board.
After stripping Lovaglio of his powers last month and ruling him out for a new mandate, the MPS board selected Palermo, the current CEO of utility ACEA, as the best of three candidates it had initially proposed as an alternative to Lovaglio.
Palermo's lack of expertise in commercial banking and the confusion around the CEO renewal process have raised alarm at the European Central Bank, which has the power to hike capital demands to sanction perceived governance weaknesses, sources have previously told Reuters.
Approved by the boards of both banks and discussed with the ECB, the plan to merge Mediobanca into MPS requires shareholder approval. A change of CEO at MPS could delay that vote, a person close to the matter told Reuters.
Italian media have reported that Palermo said in investor meetings it was important to preserve Mediobanca's autonomy even with the plan going ahead.
Leading governance advisers International Shareholder Services (ISS) and Glass Lewis have backed the board's slate of nominees led by Palermo, urging however a vote against Chair Nicola Maione and the head of the nominations committee for the chaos around the CEO succession process.
Under complex new governance rules which MPS is the first Italian company to test, the Palermo-led slate would be subject to a second round of individual votes if it comes on top. If the Lovaglio-led slate wins, it will not.
Among MPS' main domestic shareholders, Caltagirone, who last year appointed Palermo to the Generali board, will back him at MPS with a stake of 13.5%, a person with direct knowledge of the matter said.
Delfin, the main MPS investor with 17.5%, has not disclosed its stance. The Treasury, which owns almost 5%, will abstain. The biggest institutional investor, Norges Bank, with a stake of just under 3%, has said it will back Lovaglio.
(Reporting by Valentina Za; Editing by Jan Harvey)
The candidates are ousted CEO Luigi Lovaglio and Fabrizio Palermo, picked by the outgoing board.
The CEO contest could influence ongoing consolidation in Italy's banking sector and impact a planned merger with Mediobanca.
The ECB has oversight and could raise capital requirements if governance weaknesses are found.
If Palermo's slate wins, it would be subject to a second round of individual votes due to new governance rules.
Caltagirone supports Palermo, the Treasury will abstain, and Norges Bank is backing Lovaglio. Delfin has not disclosed their stance.
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