MILAN, March 12 Banca Popolare di Milano
expects the Bank of Italy to remove an additional
risk-weighting of assets it has imposed on the cooperative bank
and will not pay a dividend over the next few years if that were
not the case.
Chief Executive Giuseppe Castagna told analysts on Wednesday
that there had been "intense talks" with the central bank over
governance changes, a new business plan and a rights issue - the
three elements to which the regulator had pinned the
cancellation of the so-called 'add-ons.'
"We believe there is a very high probability we can achieve
the removal of the add-ons," Castagna said during a conference
He said Pop Milano would not pay a dividend over the course
of its new business plan if the Bank of Italy did not allow it
to remove the add-ons.
The cooperative bank said on Tuesday it was targeting a
common equity ratio of around 12 percent in 2016 from 7.1
percent at the end of last year.
The bank said in slides posted on its website on Wednesday a
planned 500 million euros rights issue would add 1.3 percentage
points to its best-quality capital with a further 1.8 points
expected from the removal of the add-ons.
(Reporting by Valentina Za; Editing by Lisa Jucca)