Too many small and weak banks to think that the Italian banking system can remain as it is for much longer. The distance between the two big names (Intesa Sanpaolo and Unicredit) and the rest of the sector is too great to imagine that surviving is enough. The addendum requested by the ECB Supervisory Authority, which curiously (!) continues to ignore the risks linked to derivatives in the hands of German and French banks and to concentrate solely on the problem loans of Italian banks, can slow down but not stop the drive towards mergers, which are returning to dominate the horizon of Italian banks.
Without digging too far into their future, the two Italian banking giants are the first to show signs of dynamism: Intesa Sanpaolo, wholly focused on wealth management, is looking for an international partner for Eurizon Capital, which could be BlackRock, while Unicredit will have to decide what to do in Mediobanca when the syndicate pact will be archived but above all questioning the opportunity to think about alliances in a European key.
For the other banks, management costs continue to be too high, personnel are excessive, profitability is too low, even in view of a possible increase in interest rates and competition, Fintech and digitization are pressing. But there are also two innovations that are pushing in the direction of mergers which will greatly influence the reorganization of the entire Italian banking system: the changing of the guard at the political leadership of the country and therefore at the Ministry of the Economy (MEF) and the recent pronouncement of the Court Constitutional which promoted the reform of cooperative banks.
It is from here – from the Popolari and from Siena – that the reorganization will start again for a new season of mergers, alliances and mergers. This was reported a few weeks ago, arousing a storm of comments and criticisms, also by Fabrizio Pagani, the right-hand man of outgoing minister Pier Carlo Padoan, who played a decisive role in the rescue plan for Monte dei Pasqua and the entrance to the Treasury in the Sienese bank as the majority shareholder with a 68% stake. What will the new tenant of Via XX Settembre in front of the MPS do? It is not foolish to think that the new government will push Siena to concentrate, even if it will not be easy to reconcile the ambitions of a public bank for the Italian economy imagined by the Five Stars and the League with Europe's strict rules on bank capitalization and on the prohibition of state aid.
Several times the major cooperative banks have had to deny the stock market speculation that imagined new mergers with Monte dei Paschi but the tongue strikes where the tooth wants. And, Siena or not Siena, the Popolari or the former Popolari will be at the center of the new banking reorganisation. Starting from Sondrio, where Popolare will have to decide what to do after the go-ahead from the Constitutional Court for the transformation into a joint stock company, which Popolare di Bari is also about to undertake.
For Popolare di Sondrio, which will probably await the definitive pronouncement of the Council of State, the marriage project between Valtellina and Credito Valtellinese could once again become topical, fresh from a controversial capital increase. But, sooner or later, the matter of aggregations will also concern the bigwigs of the Popolari, from Ubi to Banco Bpm up to the Bper, not to mention the tribulations of Banca Carige.
Ubi and Banco Bpm are returning from two successful transactions which led, on the one hand, to the acquisition at a symbolic price of Banca Etruria, Carichieti and Banca Marche by the group led by Victor Massiah while the CEO of Banco Bpm, Giuseppe Castagna, having piloted the merger between the Veronese institute and the old Bpm, has already said that in 2018 and 2019 the bank in Piazza Meda is concentrated on completing the integration operations but that afterwards he will resume looking at consolidation opportunities . But the M&A season could start much earlier in the bank.
