EXCLUSIVE Italy, UniCredit set to call off talks over Monte dei Paschi-sources

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Banca Monte dei Paschi’s headquarters in Siena, Italy, October 27, 2017. REUTERS/Stefano Rellandini/File Picture

LONDON, Oct 23 (Reuters) – Italy’s authorities and UniCredit are making ready to name off negotiations over ailing financial institution Monte dei Paschi (MPS) after efforts to succeed in an settlement over a pricey recapitalization plan fell by means of, two sources instructed Reuters.

Rome has determined it will not be capable to meet UniCredit’s requests for a recapitalization package deal price greater than 7 billion euros as this is able to make a deal “too punitive” for the Italian taxpayer, one of many sources mentioned.

Disagreements over the dimensions and prices of job cuts on the world’s oldest financial institution in addition to an accountability concern over the way in which UniCredit calculates the honest worth changes on MPS liabilities have proved to be a major stumbling block, this supply mentioned.

A second supply mentioned the events had concluded it was inconceivable to succeed in an settlement based mostly on the situations set in July, which required the acquisition of “chosen elements” of Monte dei Paschi to spice up UniCredit’s earnings per share by 10% and go away its capital unaffected.

UniCredit declined to remark whereas the Treasury was not instantly obtainable for remark.

Reporting by Pamela Barbaglia in London, Valentina Za in Milan; Giuseppe Fonte in Rome


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