Italian Prime Minister Giorgia Meloni said her government is committed to exiting its investment in Banca Monte dei Paschi di Siena SpA as she looks to end a saga involving the world’s oldest bank that’s dogged her predecessors and cost taxpayers billions in bailout funds.
(Bloomberg) — Italian Prime Minister Giorgia Meloni said her government is committed to exiting its investment in Banca Monte dei Paschi di Siena SpA as she looks to end a saga involving the world’s oldest bank that’s dogged her predecessors and cost taxpayers billions in bailout funds.
“We need to work to bring Monte back to the private market,” Meloni said in an interview with Milano Finanza newspaper published on Saturday. “We want to manage the state’s exit from MPS’s capital in an orderly manner.”
Luigi Lovaglio, the bank’s chief executive officer, is pressing ahead with a revamp including job cuts, streamlining and a switch toward more profitable commercial businesses that will allow the government to comply with the European Union’s requirement to sell its 64% stake in the lender. The bank in 2022 raised €2.5 billion ($2.8 billion) in fresh funds to strengthen capital and to finance payouts from layoffs.
Meloni, who took office in October, is taking an increasingly active stance on corporate matters. Last week, her government changed the top management of state-controlled firms including Enel SpA, Italy’s largest utility.
Founded in 1472, Siena-based Monte Paschi has undergone years of painful efforts to turn its business around. The bank was first bailed out by the Italian government in 2009. Since then, it’s struggled to return to profitability given limited room for maneuver under terms set by European authorities in exchange for approving its nationalization in 2017.
–With assistance from Chiara Albanese.
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