Same horse, new jockey

17 Oct 2016 By Neil Unmack Follow @unmack1

Corrado Passera has made a proposal to rescue Monte dei Paschi di Siena, facing off a 5-billion-euro JPMorgan plan. The ex-Intesa chief’s plan may avoid a politically-thorny debt swap, but raises fewer funds. With MPS, the politically expedient is the enemy of the good.

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The board of Banca Monte dei Paschi di Siena is reviewing a proposal by Corrado Passera, the former chief of Intesa and one-time Italian industry minister, to recapitalise the ailing bank, according to a statement sent Oct. 15.

Passera's plan would involve a 2.5-billion-euro capital increase reserved for institutional investors and a 1-billion-euro rights issue, Reuters reported. The remaining 1.5 billion euros would be raised through retained earnings, according to Reuters.

MPS is also working on a 5-billion-euro recapitalisation, led by JPMorgan.

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