Monte dei Paschi becomes a public subsidiary. After the recapitalization and the conversion of the subordinated bonds into shares, the Treasury acquires a share equal to 53,45% of the capital.
This is the percentage that emerges from the two decrees signed this week by the Minister of the Economy, Pier Carlo Padoan and landed in the Official Gazette.
The share held by the Treasury could rise to 70% after the purchase of the shares of the small shareholders who, once the securities have been converted into bonds, will be able to present the relative request.
According to what is stated in the second decree, the MEF will subscribe the precautionary capital increase of MPS for a countervalue of 3,85 billion at a discounted price of €6,49 per share. The subscription of the increase will take effect from today. The contribution by the Ministry will be completed within five days of the effective date of the subscription. The "cheque" from the Treasury will be equal to 3.854.215.456,30 euros.
The oldest nationalization in the world comes just a few days before the deadline set by the ECB on 11 August.
According to what is stated in the first decree, as well as for the Veneto Banks and for the four good banks put into resolution in November 2015, the application of burden sharing is triggered, a procedure according to which, in the event of bank failure, it is envisaged that before the involvement of public funds, the reduction of the nominal value of the shares and subordinated bonds, or the conversion of the latter into capital, is implemented.
In the concrete case, the conversion of the subordinated bonds of Monte dei Paschi into capital will result in a capital increase of approximately 4,473 billion euros through the issue of 517,1 million shares at a price of 8,65 euros. The conversion concerns four class 1 and seven class 2 issues. The overall recapitalization is therefore worth over 8,3 billion.
Once the capital increase is completed, the bank's securities, together with all the financial instruments, will once again be listed on the market.
