The Ministry of the Economy Monday has sold 25 percent of the capital of MPS (Monte dei Paschi di Siena), the Sienese bank of which she held 64.23 percent of the shares: she collected 920 million euros. The sale was reserved for so-called institutional investors, such as banks, insurance companies and investment funds. The announcement came on Monday somewhat unexpectedly, when the sale of the bank had been expected for years: the Ministry of the Economy has been the majority shareholder since 2017, when it acquired the majority of shares after yet another rescue operation. The bank has since been rehabilitated and the government has decided to begin the sale now for two reasons.
First of all, this is a period when market conditions are particularly favorable. After years of crisis and various recovery plans, the bank returned to profit and the Moody’s agency managed on Friday to raise its rating, that is to say the evaluation of the risks that it attributes to the bank . The bank’s share price has been rising for some time and closed on Monday at 3.06 euros: 20 percent higher than a month ago and 72 percent higher than a year ago. year.
The MPS share price is also impacted by very positive sector dynamics. Banks are having a particularly profitable time thanks to rising interest rates on mortgages and loans which have significantly increased their bottom line. So the state decided to sell knowing it would do so at a time when it would earn more.
The second reason why the government acted now is linked to the privatization plan it decided to launch, selling public companies or stakes that the state holds in private companies. Large privatization projects are always attractive to governments because, by law, the resulting revenues must be allocated to reducing public debt. According to estimates communicated in the DEF Update Note (NADEF), the government’s objective is to raise around 21 billion in three years. Whatever the political assessments of the desirability of privatization, on a quantitative level this is a very ambitious and unrealistic goal for most commentators: it would mean selling off a large part of the public companies in a very short deadline.
It is for this reason that the government has accelerated on two files inherited from the past and on which the sale was in progress or imminent: one concerned the sale of ITA Airways, and the other MPS. The sale of ITA Airways was essentially concluded with the transfer to Lufthansa, the government is only waiting for the positive opinion of the European Commission which is however slow in arriving. It also started selling MPS on Monday.
The history of state participation in MPS began in 2017, when, after various reorganization operations, the Ministry of Economy came to hold 64.23 percent of the shares in derogation of European competition rules . Negotiations for the sale began several times with private banks, the last in 2021 with Unicredit: they came to nothing, because Unicredit asked the State to put more money into the bank to restore it and above all because no agreement has been reached on the price.