Monte Paschi to Halt Sale of $250 Million in Bad Loansby and
Bank received lower-than-expected bids, person familiar says
Hayfin, Cerberus among companies said to have made offers
Banca Monte dei Paschi di Siena SpA has scrapped plans to sell about 220 million euros ($250 million) of secured non-performing loans after receiving lower-than-expected bids, a person with knowledge of the matter said.
Hayfin Capital Management LLP, Cerberus Capital Management LP and Fortress Investment Group LLC had all made binding offers on a package of about 40 loans backed by real estate assets, the person said, asking not to be identified as the process is private. The lender, based in Siena, Italy, may consider other options including selling part of the portfolio, the person said.
Monte Paschi is carrying about 28 billion euros of impaired loans, representing 24 percent of its total. It has sold 2 billion euros of bad loans since 2015, toward a goal of 5.5 billion euros in such disposals by 2018. Chief Executive Officer Fabrizio Viola said last month that he is considering accelerating the effort.
Spokesmen at Monte Paschi, Fortress, Hayfin and Cerberus would not discuss the matter.
Monte Paschi’s shares have declined 54 percent this year, part of a broader selloff in Italian bank stocks on concerns about banks’ credit quality.