Tuesday, October 3, 2023
HomeEconomyMonte dei Paschi's junior debt rises as Anima backs cash call

Monte dei Paschi's junior debt rises as Anima backs cash call

MILAN (Reuters) – Junior bonds at Monte dei Paschi di Siena (MPS) rose on Tuesday, adding to the previous day’s gains, helped by investors’ likely interest in a planned 2.5 billion euro ($2.5 billion) ) news of interest to the cash conference call. .

Shares of MPS rose 24% on Monday as its subordinated debt fell in the country, sources said – Anima Holding, a business partner of the own bank, is willing to play a role in the financing.

MPS’ junior debt has come under pressure in recent weeks amid concerns it could be converted into equity to help the Tuscan bank raise funds to cover restructuring costs.

MPS Chief Executive Luigi Lovaglio is working to complete a new share offering by mid-November to fund costly voluntary layoffs, but volatile markets have cast doubt on whether he will survive.

MPS junior bond prices as bankers and analysts say the bank will struggle to find investors as recession fears and political instability in Italy hit bank stocks.

Italy has pledged to cover a 64% of €2.5 billion based on its stake in the bank, but MPS must also secure private funding Compliant with EU regulations on state aid banks.

Italian asset manager Anima will prepare to provide MPS with capital of up to 250 million euros as part of a strengthened partnership w One People familiar with the matter had previously told Reuters that the Tuscan bank.

According to another person, CEO Lovaglio is not currently in talks with Anima or France’s AXA (MPS’ insurance partner), which could also consider revising its commercial agreement in exchange for an upfront Cash donations come close to the matter.

Lovaglio had said in June that he wanted to separate discussions around cash calls from discussions about partnerships.

Bankers working in financing say stronger commercial agreements will make it harder for MPS to seek mergers with healthier peers in the future.

By 1527 GMT, July 1527 bonds issued by MPS rose 3. 38 percentage points to 54., yield was 9839 .6%, according to Refinitiv data. September 250 bond up 3. 250 points to 37 .625, yields 37% ($1=0.




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