Paschi Suffering Limited Withdrawals Amid Selloff, CEO Says

Banca Monte dei Paschi di Siena SpA has suffered “limited” deposit withdrawals during the selloff that has erased about half its market value in the first three weeks of the year, Chief Executive Officer Fabrizio Viola said.

Withdrawals are “well below levels seen during the 2013 crisis,” Viola said in an e-mailed statement Wednesday. “I’m convinced that the bank will overcame this difficult phase, just as it did in the past.”

The bank, bailed out twice since 2009, has been engulfed by legal probes into former managers who had masked losses. After tapping investors for funds to replenish capital, Viola has been searching for a buyer under pressure from the European Central Bank to shore up its finances.

Shares of the world’s oldest bank were temporarily halted early Wednesday after dropping as much as 14 percent in Milan trading. The stock fell 14 percent decline Tuesday and 15 percent drop on Monday after the ECB asked several lenders including Monte Paschi for data on their non-performing loans.

Viola said in Wednesday statement that the stock’s decline doesn’t reflect the bank’s fundamentals, which improved in the final quarter of 2015. The lender has adequate capital and liquidity, the CEO added.

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