Banca Popolare di Milano Scrl fell to the lowest in more than four months after former Chairman Massimo Ponzellini was placed under house arrest as part of a probe into transactions of Italy’s oldest cooperative bank.
The shares fell as much as 9.8 percent to 30.08 cents, before being halted, making it the worst performer in the Italy’s benchmark FTSE MIB Index. The stock plunged to the lowest since Jan. 16, giving the bank a market value of 972 million euros ($1.2 billion).
The investigation, conducted by prosecutors in Milan, is focused on alleged bribes of 5.7 million euros that the bank’s executives received after granting financing to several firms, Italian financial police in Milan said in a statement today. Ponzellini, who was chairman of Popolare Milano until October 2011, is accused of corruption, money laundry and criminal association, an official at the Milan financial police office said by phone.
A spokesman for Ponzellini, who is also chairman of Impregilo SpA (IPG), didn’t return two calls seeking comment. A Popolare di Milano spokesman declined to comment.
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