• Latest
  • Trending
Italy’s problem bank casts shadow over Draghi’s summer break

Italy’s problem bank casts shadow over Draghi’s summer break

Global economies struggle as oil supplies tighten, volatile stakes

Oil prices see a surge, supply concerns to aid in the cause

S & P 500 ends at record high as Wall Street rises

Wall St futures tumble, dollar holds its ground against tides

OPEC+ members face issues of tight oil supplies

OPEC+ members face issues of tight oil supplies

U.S. energy companies shudder after economic and climate warnings

U.S. energy companies shudder after economic and climate warnings

People’s Bank and CA Sri Lanka to offer SME Mentoring Program

People’s Bank strikes Gold at Technnovation Awards 2022

Russia evades default through sheer force of will; Kremlin speaks

Russia evades default through sheer force of will; Kremlin speaks

Global economies struggle as oil supplies tighten, volatile stakes

G7 fixate on stricter sanctions to impose on Russia, oil rates wobble

People’s Bank and CA Sri Lanka to offer SME Mentoring Program

People’s Bank empowers local youth with People’s Spark Entrepreneurship Development Programme

People’s Bank and CA Sri Lanka to offer SME Mentoring Program

People’s Bank and CA Sri Lanka to offer SME Mentoring Program

Russia may be driven into default, Eurobonds due in payment

Russia may be driven into default, Eurobonds due in payment

Asia shares falls on worries over inflation, Fed outlook

An insightful glimpse of the market during the inflation period

Russia’s Sovcomflot managed to strike deals despite sanctions

Russia’s Sovcomflot managed to strike deals despite sanctions

Global Business Review Magazine
Wednesday, July 6, 2022
Nominate Here
  • Home
  • Banking
  • Finance
  • Technology
  • FinTech
  • Business
  • Videos
  • Events
  • Awards
  • Magazine
No Result
View All Result
Global Business Review Magazine
No Result
View All Result

Italy’s problem bank casts shadow over Draghi’s summer break

Italy’s problem bank casts shadow over Draghi’s summer break

When Italian Prime Minister Mario Draghi returns from his brief summer break one of the thorniest items on his to do list will be finally fixing the woes of the world’s oldest bank, Monte dei Paschi di Siena. The Tuscan lender’s decline has tarnished Draghi’s record ever since 2008 when, as Bank of Italy chief, he approved its purchase of rival Antonveneta at an inflated price that analysts say contributed to its financial meltdown.

Thirteen years of scandals, crisis management and state help to keep MPS afloat have turned the country’s fourth largest lender into Rome’s No.1 banking headache, with failure seen risking Italy’s financial stability. Selling the bank would complete a restructuring of the country’s banking industry which has shed 250 billion euros in impaired loans over the past five years. This is as lenders brace for a new wave of bankruptcies due to the COVID. Parties of all stripes in Draghi’s national unity coalition are protesting over job losses as a result of the proposed tie-up with Milan-based UniCredit.

YOU MAY ALSO LIKE

People’s Bank strikes Gold at Technnovation Awards 2022

People’s Bank empowers local youth with People’s Spark Entrepreneurship Development Programme

Antonio Misiani, economics chief of the centre-left Democratic Party said that the MPS’ territorial roots, its workers and its brand must be safeguarded. This is because, battle lines are drawn ahead of what are set to be complex talks. Politics and MPS have long been intertwined. Siena, like the rest of the central region of Tuscany, is a traditional bastion of the PD, which has often been criticized for contributing to the bank ‘s troubles by using it as a source of patronage, jobs and votes.  Processions in Siena’s annual medieval pageant have always made three stops to bow before the city institutions, at the city hall, at the archbishopric and at the MPS headquarters. Mayor Luigi De Mossi told that the people of Siena fell into three big categories. Those who worked at MPS, those who wanted to work at MPS and those who used to work at MPS.

UniCredit doesn’t want MPS’ branches in Italy’s poor south. It has only agreed to consider buying selected parts of the smaller partner on condition its capital buffers are unaffected and its earnings per share rise by at least 10%. Moreover, the state, which owns 64% of MPS, will keep all legal risks stemming from its mismanagement and any loans already in trouble or which UniCredit deems likely to turn sour. That may be increasingly difficult as MPS’ problems rise to the top of his government’s agenda and the front pages of the country’s newspapers. The UniCredit deal could cost Italian taxpayers more than 5 billion euros in state support for layoffs, tax incentives and a commitment to reinforce the merged bank ‘s capital, while MPS’ future is fueling tensions in Draghi’s ruling majority.

Politicians, however, are demanding to know from Draghi the precise price tag of the merger. Raising the political stakes even higher is the fact the PD’s leader, Enrico Letta, who has no seat in parliament, has chosen the upcoming by-election in Siena to try to get one. Salvini’s League and its rightist ally Brothers of Italy sense the chance of delivering a fatal blow to the left. In Siena’s sun-baked streets, semi-deserted during the August holidays, locals shrug off the by-election and say all they care about is saving jobs.

Tags: BankingDraghiElectionRome
ShareTweetShare
Global Business Review Magazine

Global Business Review is a online print magazine focusing on the updates and information about on emerging markets, Finance, Banking, Technology. Global Business Review provides news, features, analysis, commentary, and interviews from industry across the globe.

Recent News

  • Oil prices see a surge, supply concerns to aid in the cause
  • Wall St futures tumble, dollar holds its ground against tides
  • OPEC+ members face issues of tight oil supplies
  • U.S. energy companies shudder after economic and climate warnings
  • People’s Bank strikes Gold at Technnovation Awards 2022

Categories

  • Banking
  • Business
  • Events
  • Finance
  • FinTech
  • Tech
  • Videos
  • About
  • Nominate
  • Privacy & Policy

© 2022 Global Business Review Magazine - All Rights Reserved.

No Result
View All Result
  • Home
  • Banking
  • Finance
  • Technology
  • FinTech
  • Business
  • Videos
  • Events
  • Awards
  • Magazine

© 2022 Global Business Review Magazine - All Rights Reserved.

Go to mobile version