Italian Government Open to Selling its Remaining Stake in MPS
Italian Prime Minister, Giorgia Meloni, recently indicated that the government is open to selling its remaining interest in Monte dei Paschi di Siena (MPS), one of Italy’s most historic banks. Although there are no immediate plans for such a move, the government does not rule out the possibility of selling its remaining 4.9% stake in MPS. This announcement came during a traditional New Year’s press conference, with Meloni asserting that there’s no rush to make a decision, as reported by Reuters.
Background of the MPS Privatisation
Italy’s government initiated the privatisation of MPS in 2023 to meet European Union conditions. The government’s stake in MPS was significantly reduced from 68%, which was acquired during the 2017 rescue, to 4.9%. This reduction was achieved through a series of share placements over the past two years and following the acquisition of a majority stake in Mediobanca by MPS. The Ministry of Economy and Finance managed to reduce its stake through three public offerings, raising about €2.7bn and bringing its holding down to roughly 12%. This was prior to further dilution resulting from the Mediobanca deal, as reported by Bloomberg.
Impact of the Government’s Minority Stake
According to Prime Minister Meloni, due to its minority stake, the government now holds little influence over MPS. Any moves by MPS to become a competitor to major Italian banks such as UniCredit and Intesa Sanpaolo through mergers or acquisitions should be regarded as beneficial for competition. In fact, it was reported in November that the Italian government was aiming to further reduce its stake in MPS through a potential future merger, with particular attention on a longstanding objective to merge MPS with competitor Banco BPM.
Ongoing Investigation into MPS’s Takeover of Mediobanca
Prime Minister Meloni also addressed the ongoing investigation into MPS’s takeover of Mediobanca. Prosecutors in Milan are examining whether CEO Luigi Lovaglio and investors Francesco Gaetano Caltagirone and Delfin Sarl Chairman Francesco Milleri coordinated actions without informing regulatory authorities and shareholders. Meloni stated that she is not worried about the inquiry and noted that the prosecutors have stated there was “nothing illegitimate” in the government’s conduct regarding the stake sale. She added, “I am not concerned about the ongoing investigation into MPS. Even the prosecutors have said that there is nothing illegal about the government’s actions.” The finance ministry is not subject to any investigation related to these transactions, according to Bloomberg.
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