MILAN (Reuters) - Shares in Banca Monte dei Paschi di Siena <BMPS. MI> rose more than 4 percent on Monday on speculation of a possible stake sale by the bank's biggest shareholder, even though this was denied.

The charitable banking foundation that owns 33.5 percent of Italy's third-largest bank needs cash to repay 339 million euros of debt and is trying to find buyers for part or all of its stake.

But the foundation denied a report in newspaper La Repubblica that it was close to selling a 20 percent stake to three other banking foundations and a group of investors at 0.14 euros a share.

It also said that a planned meeting of its board on Monday was not going to discuss any stake sale proposal.

Monte dei Paschi's shares rose to their highest in nearly two weeks at 0.1793 euros and were up 4.13 percent by 1116 GMT in volatile trade.

"The shares are rising on speculation that other banking foundations could be involved," said one Milan-based trader. "Many investors are short on Monte Paschi and the newsflow is forcing a few funds to close their positions, whatever happens."

Shares in Monte dei Paschi have fallen by more than 20 percent in the past month, close to a record low, because of a clash between Monte dei Paschi and its biggest shareholder over the timing of a vital capital increase.

The foundation has threatened to vote against a 3 billion euro cash call planned for January at a December 27 shareholder meeting unless the bank's management agrees to push it back to May or later.

Monte dei Paschi needs to carry out the capital increase to help repay 4.1 billion euros of state aid it received earlier this year to stay in business after it was hit by the euro zone debt crisis and a derivatives scandal.

Its management, led by Chairman Alessandro Profumo and Chief Executive Fabrizio Viola, wants to tap investors for cash before an expected raft of capital increases by other European banks following a European Central Bank asset quality check-up.

The foundation fears it may not have enough time to arrange a favourable sale of all or part of its stake if the capital increase is carried out in January as planned.

(Reporting by Francesca Landini and Maria Pia Quaglia,; Editing by Lisa Jucca and Jane Merriman)

About News.net

Publishing Services International Limited (PSIL) is the publisher and operator of a worldwide network of online news sites dedicated to delivering fair, accurate and relevant reporting from a variety of the world’s most trusted sources – from the biggest cities to the smallest towns.

We deliver positive and powerful messages to our readers, providing up‑to‑the‑second news that matters to the individual.

Our promise is to serve communities and individuals worldwide, delivering information that hasn’t always been available to them. We will give them back a voice – a voice that’s empowering because it is theirs – and provide a platform to communicate between themselves and the world.

We believe people are not just generic demographics; they are individuals with their own preferences and curiosities. We are about understanding these individuals, listening to them, and serving them.

We are the new pioneering spirit of news – we’re not talking to everyone, we’re talking with every one.

If you want your news, your voice, your way, on your time – we’ve got news for you.

 

FAQs

Email

If you have any questions or concerns please email us on support@news.net

Phone

  • Australia, Toll Free 1-800-983-421
  • Hong Kong, Toll Free 800-906-187
  • Singapore, Toll Free 800-852-3871
  • USA/Canada, Toll Free 1-800-830-4132

Advertise With Us

Interested in being awesome?
Contact us by email or phone.

Cancel