MILAN (AP) — Troubled Italian bank Monte dei Paschi di Siena says it will need more rescue money than previously expected, as a government rescue looms. The bank said in a statement issued late Monday that the European Central Bank had estimated its capital shortfall at 8.8 billion euros ($9.2 billion, 84,4 billion Norwegian Kroner), well above the 5 billion euros Monte dei Paschi had been planning to raise. The facade of a branch of the ‘ Monte Dei Paschi di Siena ‘ bank in Milan, Italy. In a statement issued late Monday Dec. 27, 2016, the European Central Bank estimates the Monte Dei Paschi di Siena bank will need more rescue money than previously expected, reports Associated Press. ECB-chief Mario Draghi said in november that he is concerned both with Donald Trump and weak European banks.he European Central Bank. ECB wrote in a trading update in november that the global markets are becoming a more risky place to put money.
The increase in the sum is due to the fact that Monte dei Paschi’s capital position has deteriorated in the past month, apparently as customers withdrew deposits. Italy’s government on Friday said it was guaranteeing all of the bank’s retail customers with part of a 20 billion-euro fund approved by parliament to ensure the stability of banks. Monte dei Paschi had failed to raise enough capital independently.
One of the Main Banks
Monte dei Paschi di Siena is one of the main banks in Italy. It is the flagship of the MPS Group, which is a leader on the domestic market in terms of market share. Monte dei Paschi, familiarly called «il Monte,» was founded in 1472 under the auspices of the Republic of Siena. It became the ideal heir of Siena’s prestigious medieval mercantile and banking traditions, developing an efficacious system of credit to the advantage of the local economy. The public character of the Monte was confirmed with the reform of 1624, which equipped the bank with progressive banking structures. On this occasion, the Medici Grand Duke granted depositors state guarantees on their money by entailing the income from the state-held pasture lands in the Maremma (the «Paschi» which gave the bank its name).
It is especially meaningful that the Grand Duke asked in return to be indemnified by the entire citizenry of Siena for any losses he might incur. On this foundation, Monte dei Paschi was able to consolidate and increase its banking activity in the seventeenth and eighteenth centuries. Thus the bases were created for its considerable expansion right after national unification, and even more significantly in the twentieth century. Norwegian Banks Investment Management have investet 8451 million Norwegian kroner in six large Italian Banks. NBIM have invested 391 million NOK in Banca Monte dei Paschi di Siena Spa(1,13 %), 599 million kroner (1,84 %) in Banco Populare dell`Emiglia Romagna SC, 1 billion kroner(NOK) in Banca Populare di Milano(2,6 %), 461 million kroner(NOK) (2,55 %) in Banca Populare di Sondrio SCARL, 1 billion kroner(NOK) in Banco Populare(2,3 %), and 5 billione kroner(NOK)(1,73 %) in UniCredit Spa .
Transfered into Corporation
In 1995, by decree of the Minister of the Treasury, the banking firm was transformed into a corporation called Banca Monte dei Paschi di Siena. The Bank operates, also through its subsidiaries, in the various sectors of banking and finance, from traditional banking to special credit to asset management, insurance, and investment banking, with more than 1,900 branches all over Italy and a presence in the world’s major economic and financial centers. The Monte has a strong retail vocation (families and small and medium businesses) that helps to make it the «bank of reference» in all the areas in which it is active. Since June 1999, Banca Monte dei Paschi di Siena shares are traded on the Mercato Telematico Azionario (screen-based trading market) of the Italian Stock Exchange, and since September 1999 it is listed on the market’s most representative index, FTSE MIB.
European Banking Data
The European Central Bank (ECB) has published the end-June 2016 Consolidated Banking Data (CBD), a data set of the European Union (EU) banking system on a group consolidated basis. The quarterly CBD cover relevant information required for the analysis of the EU banking sector, although a leaner subset compared to corresponding end-year data. The end-June 2016 data refer to 353 banking groups together with 3,201 stand-alone credit institutions, and include data for 957 foreign-controlled branches and subsidiaries operating in the EU, covering nearly 100% of the EU banking sector balance sheet. Nordic News will stress that NBIM have invested 391 million NOK in Banca Monte dei Paschi di Siena Spa(1,13 %), which is the only bank mentioned in Associated Press`article. The Source of the Norwegian investments in Italians Banks is coming from NBIM, in this article, writes Nordic News.
