Private equity funds are gearing up for a new big race in Italy, the target being four mid-size “good banks” which were split last November from bad banks after a Government rescue that left many investors with worthless bonds: Nuova Banca delle Marche, Nuova Banca dell’Etruria e del Lazio, Nuova Cassa di Risparmio di Chieti e Nuova Cassa di Risparmio di Ferrara.
Actually the Bank of Italy, in agreement with the Italian Government and the EU Authorities, started a sale process for the banks, the Central Bank said in a press release last December 30th.
To this end, adds the Bank of Italy, “through a call for tenders, the Bank of Italy has selected Société Générale as financial advisor, Oliver Wyman as strategy consultant and Studio Chiomenti as legal advisor. The selling process will be carried out swiftly and will be overseen by the Bank of Italy’s Resolution and Crisis Management Unit by means of the Resolution Fund, an institution provided for under both European and Italian law and financed by contributions from the entire Italian banking system in compliance with the European rules on State aid. The process will be transparent, non-biased and have the sole objective of maximizing the proceeds in the interest of the economic areas served by the Banks”
The Central Bank also stresses that “the assets of the four banks were restructured to facilitate the selling process: each “bridge bank” has capital equal to 9 per cent of total risk-weighted assets; some legacy assets (non-performing loans) will be transferred to a new, separate, special purpose vehicle named REV Spa, also capitalized by the Resolution Fund, which will collect the proceeds of the sale or management of these assets. Excluding the non-performing assets, the four Banks together account for a market share of about 1 per cent of system-wide deposits, and an initial net equity of € 1.8 billion. The Banks’ operations and commercial activities are currently managed by specially appointed Boards of Directors, each chaired by Mr Roberto Nicastro“.
And Mr. Nicastro himself in a press conference in Arezzo last December 30th said that “the EU calls for the sale of the four banks is to finalized as soon as possible and our aim is to do that by next Spring. We still do not know whether the sale involves all four banks together or bank by bank. A possible merger of the four banks is a decision that will eventually affect the unique investor who might buy them all and this is not a task that we are call to accomplish. As for the minimum auction price this will be an indication of the advisor”.
Finally, as for Nuova Banca Etruria, “we have about 30 expressions of interest from both Italian and internazional subjects”, Mr. Nicastro said, adding that “specific expressions of interest came for Banca Federico del Vecchio, but it has not been decided yet If the bank will be sold apart or not. A decision will be taken after a formal recognition of all the expressions of interests will have been made which will happen in February”.
The financial sector has been quite active in the last few months in Italy. As for the consumer credit sector, for example, there are three cases open on the desk of potential investors and namely Creditis (Banca Carige), BBVA Finanzia (BBVA) and Accedo (Intesa Sanpaolo), while in the asset management sector an auction for Arca sgr is to start shortly and in the investmetn banking sector a sale process for GE Capital Interbanca is ongoing.
