By Giovanni Legorano
ROME--Banca Monte dei Paschi di Siena SpA (BMPS.MI) said its
board has started to review its strategic options to plug a 2.1
billion euro ($2.66 billion) capital shortfall identified by
European regulators' comprehensive assessment, the worst result of
all the banks under scrutiny.
To this end, the bank said it has hired investment banks
Citigroup (C) and UBS (UBS) as advisors.
Monte dei Paschi said several factors weigh on this far from
flattering result, which it said is mainly the result of the
regulators' stress test under the so-called adverse scenario.
The bank said the European Central Bank didn't include the
effect of a residual part of a government loan, the transformation
of the bank's business into a more commission-based lender, or the
impact of improvements in the lender's credit quality, all
contained in the bank restructuring plan.
"The result of the exercise [comprehensive assessment] has been
penalized by the way in which it has been conducted," the bank said
in a statement.
Monte dei Paschi obtained a government loan of EUR4.1 billion to
stay afloat. This year, after selling fresh shares for EUR5
billion, it paid back around three-quarters of it. In exchange for
that loan, the bank has compiled a tough restructuring plan aimed
at bringing it back into the black by 2017.
Write to Giovanni Legorano at giovanni.legorano@wsj.com