Paschi Rescue to Cost Italy 6.6 Billion Euros, Central Bank Says
- Official estimate of state aid given in Bank of Italy note
- Institutional investors would bear remaining costs of rescue
Rescuing Banca Monte Paschi di Siena
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Italy’s rescue of troubled lender Banca Monte dei Paschi di Siena SpA will cost the government about 6.6 billion euros ($7 billion), the country’s central bank says, providing the first official estimate of public funding.
About 4.6 billion euros are needed to meet capital requirements and 2 billion euros would be required to compensate the lender’s retail bondholders, the Bank of Italy said in a statement late Thursday. There also would be an additional 2.2 billion euros of costs borne by institutional investors, the Rome-based institute said.