Cerberus Capital Management LP and Banca Ifis SpA bought 1.3 billion euros ($1.5 billion) of non-performing loans from Banca Monte dei Paschi di Siena SpA.
The two companies each bought 650 million euros of bad loans that were held by Paschi’s former consumer credit unit, Consum.it, Banca Ifis said in a statement Tuesday. The transaction should close by the end of the month, Ifis said.
Monte Paschi is selling bad assets from Consum.it after abandoning the sale of the whole unit last year. The disposal is part of the bank’s plan to rebuild capital buffers eroded by mounting loan losses.
Italy’s third-largest bank, raised 3 billion euros in a stock sale last week, the second in less than a year to strengthen finances.