Mps ends successfully the capital increase of 2.5 billion, after the call to arms of the Treasury towards banks, foundations and social security funds, and the 125 million paid by the Sienese bank to convince the guarantors to subscribe to the unopted. And yet, despite the success, on the day in which the results of the capital strengthening are announced – Friday 4 November – certifying the success of the operation, the Monte Paschi di Siena stock opens in Piazza Affari with a thud of 7%, to then end up in the volatility auction, suspended downwards with a thud equal to -14%, which becomes over 19% when the shares collapse to 1.5 euros, a value much lower than the 2 euros of the new shares issued with the recapitalization. For Monte’s shares the session ends with a splash of 11.96% to 1.62 euros.
On the same day, on the occasion of the publication of the third quarter accounts of the bank he manages, the ceo of Intesa SanPaolo Carlo Messina rejects the hypothesis of an M&A with the Sienese bank: “I am in favor of having more competitors on the market. I do not know the numbers on the prospects of MPS, but it is certainly not an operation that can concern Intesa Sanpaolo “Messina says convinced, after pointing out that “The country cannot have any weaknesses” is that “Banca Monte dei Paschi di Siena is a history of our country that must be resolved”. The capital increase of Mps? For the CEO of Intesa SanPaolo “It is a strategic factor” and the evaluation can only be positive.
“Moreover – adds Messina – the rate hike will also favor MPS in generating future profits and recovering profitability, while I assume that in the past they have had a negative impact from low interest rates “.
In short, it’s done: Mps collects those new fresh vehicles it needs, 2.5 billion euros, in what is confirmed the seventh capital increase in 15 years, 14 to be exact. Of this sum, much will be used primarily for finance the voluntary departures of employeeswho have opted for a real one maxi exodus from the bank: compared to the 3,500 employees previously estimated, the Monte employees who want to flee are 4,125, of which 4,005 for the MPS group and 120 as extra group secondments.
Mps: the new shareholders after the capital increase
But what is the new shareholder structure of Monte dei Paschi post recapitalization?
In pole position as the first shareholder the Treasury-Mef remains, with a share of approximately 64% of the capital; the second shareholder is Monte’s insurance business partner, the French company Axa which, with an injection of 200 million euros, will own 8% of the new MPS.
Pimco, the US bond fund who paid money out of his own pocket as the holder of subordinated bonds at risk of burden sharing (hypothesis feared, among other things, by the ECB itself), will be a shareholder with a stake of approximately 3%, as will the share held by the many foundations that have responded to the Treasury’s subscription call for 3%.
Among these, the foundations Cr Firenze, Mps, Lucca, Pistoia and Pescia, Cariplo and Compagnia SanPaolo. In particular, the Mps Foundation announced that his stake in MPS has risen 0.003% to 0.40% approximately of the share capital after the share capital increase.
Shareholder also Anima, with a 1% stake against the 25 million injected.
Then there are the underwriting syndicate banks who have assumed an unexercised, or unsubscribed shares, for Approximately 93 million euros, becoming shareholders of Monte (but for how long?). Among the names of the new shareholders are also those of Mediolanum and Andrea Pignataro’s Ion Groupas well as those of Nexi, Tenax and the Inarcassa and Enpam pension funds.
Mps: escape of guarantee consortium banks after maxi-commission?
Having said that, Monte’s shareholding structure is anything but solid. And this is demonstrated by the fact that it seems to have been the one to capitulate the title in last Friday’s session the decision of some of the guarantor banks themselves to give it upafter having collected the maxi commission of 125 million euros.
So we read in an article de The nation:
“The maxi commission of 125 million euros was collected to guarantee less than 900 million of unexercised potential, among the eight banks guaranteeing the Mps increase (Mediobanca, Citi, Credit Suisse, Bofa, Barclays, Santander, Stifel, Socgen) the free all was triggered. Some of the institutes that wasted no time e they poured on the market at values of just over 1.6 euros the shares that until yesterday were trying to get subscribed for 2 euros. The influx of a large quantity of paper in the face of a tight free float contributed to plunging the prices of Monte, which closed with a 12% thud, to 1.62 euros, while the Ftse Mib jumped by 2.5 % “. However, the article specified that “It would seem that Piazzetta Cuccia (Mediobanca) and the asset manager Algebris they held the shares, waiting for better times “.
Mps: the warning from the ECB and the state flop with Orcel’s UniCredit
It remains in the background the warning that the ECB Supervisory itself had launched the MPS capital increase at the starting line on 17 October. Thus in the prospectus drawn up by Monte relating to the recapitalization:
“In the context of the Draft SREP Decision 2022, the ECB highlighted points of attention that could limit the ability of Mps to fully achieve the objectives of the 2022-2026 Business Plan in the medium term with reference to: the persistence of tensions on the BTP-Bund spread and market volatility with potential negative repercussions on the cost of funding; the expected dynamics of commissions which, although considered reasonable, depend on the success of the commercial initiatives planned and are exposed to competitive pressure; the reduction of personnel costs based on a maneuver of redundancies of personnel exposed to the risk of fewer subscriptions than those planned; the increase in interest rates and a less favorable GDP scenario which can adversely affect the repayment capacity of debtors; the progress of complaints and lawsuits that is not in the full control of BMPS, as well as the ability to prevent the occurrence of further litigation. In the aforementioned document, the ECB also highlighted that the additional cost savings of Euro 40 million starting from 2024 due to the closure of branches, the corporate reorganization of the Group and IT investments in digitization they could be offset by inflationary levels related to the new macroeconomic scenario which could be higher than expected and could not be limited to public utility services, also reducing the savings deriving from the same investments in digitization “.
In short, it is premature to say that MPS has won the game.
Much less the taxpayers won, who had to pay for the recapitalization of the Sienese bank out of their own pockets, for the umpteenth time.
This, in view of the goal of a privatization of Monte with the definitive exit of the shareholder General Staff from its capital, which has already confirmed itself as a sort of Mission Impossible in the past, due to the absence of potential white knights ready to take over Mt.
The brief parenthesis of the negotiations with UniCredit by Andrea Orcel – and that maxi figure that he would ask despite the promise of a lavish gift from the state – it ended with a flop of the same state. Mps has paid – and risks continuing to pay – the toxic embrace with politics is that indelible reputation of a bank that has burned billions of euros between Antonveneta, Lehman crisis, spread crisis, EU and NPL rules.
To put it in the words that Orcel himself had uttered, the truth is that on Monte dei Paschi di Siena omnipresent is the fear that it will yield to a more political logic than a market one. And this will never be a good business card.