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Paschi to Proceed With Share Sale, Bigger Swap to Avert Aid

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Banca Monte dei Paschi di Siena SpA will seek to sell shares by the end of the year and extend a debt-for-equity swap in a last-ditch effort to raise 5 billion euros ($5.2 billion) privately and avoid a state rescue.

The swap offer will be increased to 4.5 billion euros and will include its so-called FRESH 2008 hybrid bond, the Siena, Italy-based bank said in a statement on Wednesday. Bondholders have already agreed to exchange about 1.02 billion euros for shares. The swap offer for retail investors as well as the share sales reserved to them are subject to regulatory approval.