By Liam Moloney and Giovanni Legorano
ROME--Italy's Economy Minister Pier Carlo Padoan said Thursday
he expects local lenders to find market solutions for their need to
lift capital after a European Central Bank health check found two
of them with a shortfall that still needs to be plugged.
The ECB review found two Italian banks to have a capital
shortfall, said Mr. Padoan at a conference in Naples. "We are
trustful that there will be market solutions to fill this capital
shortfall gap."
The two banks are Banca Monte dei Paschi di Siena SpA and Banca
Carige SpA.
The options that Monte Paschi has to plug a 2.1 billion euro
($2.65 billion) capital shortfall are widely open and include
issuing convertible bonds into shares that count as capital,
selling fresh equity, as well as disposing of assets, or even
merging or being taken over by a larger bank.
The Siena-based lender is also considering delaying the
repayment of a residual part of a state loan to 2017.
Monte Paschi has until Nov. 10 to present to the ECB a detailed
plan explaining how it plans to cover for the capital gap. The ECB
aims to complete the approval process by the end of the year.
Monte dei Paschi declined to comment
Banca Carige has said it will sell new shares for at least
EUR500 million and also said it has agreed to dispose of two
insurance businesses to Apollo Management Holdings LP for EUR310
million .
Guglielmo Valia of MF-DJ in Naples contributed to this
story.
Write to Liam Moloney at liam.moloney@wsj.com and Giovanni
Legorano at giovanni.legorano@wsj.com