The tale of Monte dei Paschi di Siena’s (MPS) acquisition of Mediobanca, which involved two of the major participants in the Italian banking industry, is a convoluted web of judicial interventions, political choices, and financial maneuvers.
Allegations against the Ministry of Economy, intense political debate, and doubts about the transparency of the activities have all been triggered by the government’s support for the establishment of a new financial behemoth.
Regulations at the time forbade MPS from using public funds to purchase other banks, and state funds were used to save the company in 2017. According to the European Commission, this limitation has been lifted, allowing MPS to try purchases such as Mediobanca lawfully.
Therefore, there is clear government sanction, but the goals may extend beyond safeguarding residents’ property. Opposition parties claim that the state encouraged takeovers by organizations aligned with the ruling party’s objectives, as Democratic Party secretary Elly Schlein has publicly declared.
A few years after the government acquired a controlling stake in MPS through a €5.4 billion state bailout, MPS shocked many by making a buyout offer for Mediobanca in January. Currently, it occupies about 86% of the capital of the erstwhile Milanese rival.
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