⁍ MPS has set aside cash covering only a fraction of around 10 billion euros in claims it faces.
⁍ The bank booked 357 million euros in provisions against legal risks in the second quarter.
⁍ Activist investor Bluebell Partners has asked Italian prosecutors to check first-half earnings comply with accounting standards.
– It was a bad week for Monte dei Paschi di Siena. The Italian state-owned bank’s former CEO and chairman were convicted Thursday in a false accounting case, and sources tell Reuters the bank may now need to set aside more money for legal risks. Former CEO Fabrizio Viola and former Supervisory Board President Carlo Salvadori were convicted of not correctly booking two derivative transactions between 2012 and 2015. Under Italian law, a verdict can be appealed twice. Former MPS Chairman Alessandro Profumo, former CEO Fabrizio Viola, and former Supervisory Board President Carlo Salvadori were convicted last week of not correctly booking two derivative transactions—known as Alexandria and Santorini—between 2012 and 2015. The defendants have said they will appeal the sentence. Italian PM Giuseppe Conte gave the final green light at the weekend to measures paving the way for a bad loan clean-up at MPS and the eventual sale of the state’s stake.
Source: https://www.reuters.com/article/monte-dei-paschi-provisions/corrected-update-1-monte-dei-paschi-mulling-higher-provisions-after-court-ruling-sources-idUSL8N2HB1UK