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ReachX Special Situation Sparks - Deep Dive Credit Analysis of Banca Monte dei Paschi di Siena [Audio + Presentation]

Publication Date: 14 Mar 2019 - By GJ Prasad By GJ P.

Thematic Investment Strategies Events Macro Fixed Income/Credit EU Financial Services


This event was recorded on 21 March 2019


  • Founded in 1472 and having survived many crises, MONTE is now in critical condition.  
  • Systemic importance increased with 2008 acquisition of Banca Antonveneta
  • Lost market access to funding and capital raising leading to multiple bailouts by the Italian Government


  • Italy’s 4th largest commercial bank by assets with a focus on retail / SME lending.
  • Considered a domestically important financial institution
  • Stock declined more than 60% in the last year on worries of potential additional capital injection requirement.
  • Market capitalisation is around EUR 1.5 billion (P/TNAV of 0.2 times).
  • Government owns 68.2% stake having invested EUR 8.3 equity capital 
  • Undergoing radical restructuring dictated by agreement with European Commission
  • Overall very weak credit profile reflecting low profitability and poor asset quality.

This presentation reflects the personal views of the author on the above issuer’s risk profile based on an extensive deep dive fundamental analysis and uses certain assumptions and estimates.  This is NOT investment research and hence should be used as a basis for discussion only.  And it is not an advisory report as it does not seek to make any investment recommendations. The research is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal.  It does not constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual clients. Clients should consider whether any advice or recommendation in our research is suitable for their particular circumstances and, if appropriate, seek professional advice, including tax advice.

The presentation is destined to professional investors.

The Author


Financial Analysis, Credit Analysis, Market Analysis, Accounting, Portfolio Management, Treasury Management, Equity Fundamental

Financial Services


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