The capital increase of Mps rises to 5 billion. The BoD, which met in the morning, unanimously resolved to propose to the Extraordinary Shareholders' Meeting a capital increase up to a maximum of 5 billion euro, replacing the amount of 3 billion euros already authorized on 28 December 2013. The decision confirms the press rumors of the last few days on the management's willingness to take advantage of the current interest of investors and the abundant liquidity in the system to bring an additional 2 billion in cash with a view to putting hay in the farmhouse for the European stress tests and finishing repaying all the 4,1 billion in Monti bonds in advance (and not just 3 billion). The decision on the accelerated repayment of the Monti bonds will in any case be taken later in the light of the results of the ECB's asset quality review.
Mps explains in a note: "In a context characterized by high uncertainty and limited visibility regarding the so-called Comprehensive Assessmemt process, which includes the Stress Test and the Asset Quality Review, conducted by the Supervisory Authority at European level, the Bank has decided to adjust its capital ratios to the best market standards. On a pro-forma basis, post capital increase of Euro 5 billion and assuming the repayment of Euro 3 billion of New Financial Instruments, the Bank's capital ratio as at 31 December 2013 will be 13,6% in terms of Cet1 without phase in and 11,3% in terms of Cet1 Bis 3 considering the full impact deriving from the introduction of the new Basel 3 rules ( fully loaded)”.
In other words, the increase in the capital increase to 5 billion euro is intended to provide the bank with a capital buffer functional to the absorption of any negative impacts arising from the Comprehensive Assessment and continue to meet the commitments undertaken in the business plan. "The greater dimension of the capital increase will allow Bmps - writes the bank - to accelerate the implementation of the 2013-2017 Business Plan, making the most of the opportunities deriving from a possible recovery of the macro-economic conditions and of the banking activity and potentially speed up, depending on the results of the Comprehensive Assessment, the full repayment of the New Financial Instruments with respect to the times agreed with the European Commission".
The Extraordinary Shareholders' Meeting will be convened in Siena for 20, 21 and, if necessary, for 22 May, respectively in first, second and third call, at 09:30 in Viale Mazzini 23. At that meeting the meeting will be called to confer on the Board of Directors the necessary powers to also define the methods and terms of the capital increase and, close to the start of the operation, the subscription price of the newly issued ordinary shares, the maximum number of new ordinary shares to be issued and the related option ratio.
The existence of the consortium has been confirmed even in the face of the increase to 5 billion. In particular, the pool is made up of the same banks that signed the pre-guarantee agreement last March: UBS as Global Coordinator and Joint Bookrunner, Citigroup, Goldman Sachs International and Mediobanca as Co-Global Coordinators and Joint Bookrunners and, in addition, Barclays, BofA Merrill Lynch, Commerzbank, JP Morgan, Morgan Stanley and Socie´te´ Ge´ne´rale as Joint Bookrunners.
