Monte Paschi will implement shareholder option to raise capital - CEO

October 10
9:50 AM 2013

Banca Monte dei Paschi di Siena SpA chief executive Fabrizio Viola on Thursday had told reporters from the sidelines of a conference in Rome that the bank would hope to raise capital by offering options to its shareholders.

"No decisions have been taken yet but it's plausible to think that an option for the 2.5 billion is the one to focus on," Viola said.

The Italian bank had been struggling to get out of its curent financial rut. Previous management, including former bank president Giuseppe Mussari, had earlier entered into derivatives contracts with Deutsche Bank and Nomura. The derivatives contracts had generated losses estimated to be around the EUR500 million to EUR750 million range.

The company's current Board of Directors had agreed to increase capital of EUR2.5 billion, of which 98% of shareholder vote approved the move. Banca d'Italia (Bank of Italy) had approved Monte Paschi's EUR3.9 billion bailout assistance on January this year.

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