UPDATE 2-Monte Paschi main shareholder says profit too low

* MPS foundation wants profit at target level

* Bank in no rush to sell bank branches

* No capital increase in next three yrs

(Adds capital increase comments, branch sales, share close)

MILAN, April 29 (Reuters) - Banca Monte dei Paschi di Siena SpA's (BMPS.MI) profitability is too low and needs to be brought back into line with group targets, President of the MPS foundation Gabriello Mancini said on Wednesday.

The MPS foundation owns 55 percent of Monte Paschi, the Consob market regulator's database showed.

"It is essential to return as soon as possible to the level of ordinary profitability in line with the (business) plan targets and with the scale and potential (the bank) has reached," Mancini said during the Monte Paschi annual shareholder meeting.

In 2008, BMPS posted a net profit of 953 million euros, down from 1.37 billion euros the previous year.

The cuts in costs foreseen this year are welcome, but profitability is low and not only because of the financial crisis, Mancini said.

The foundation remains convinced it made the right choice in supporting Monte Paschi's acquisition of Banca Antonveneta from Santander (SAN.MC), he added.

The Siena-based bank, the world's oldest, bought Antonveneta in 2008 for 9 billion euros.

In other comments, the bank's chairman, Giuseppe Mussari, said in the margins of the meeting that the bank does not plan a capital increase during the next three years.

"We don't believe that a capital increase is among the things that we will do in the next three years," he said.

During the meeting, Mussari said BMPS is not in a hurry to sell the 150 branches it has to divest to meet antitrust requirements on its Antonveneta acquisition.

"We are not ready to sell at less than the real value of the assets. If we have to wait, and if the (antitrust) authority allows it, we will wait," he said.

At end-January Italy's antitrust authority extended by four months to mid-September the deadline for the bank to sell the branches.

BMPS shares closed up 1.06 percent at 1.235 euros, underperforming the sector, which was up 3.81 percent. (Reporting by Giuseppe Fonte; Writing by Nigel Tutt; Editing by Andrew Macdonald and Jon Loades-Carter)