April 4, 2014 / 5:50 PM / in 3 years

UPDATE 1-Banca Carige savings shares rise more than 25 percent

2 Min Read

(Recasts with bourse statement)

MILAN, April 4 (Reuters) - Banca Carige's savings shares, mostly held by the Carige foundation, rose more than 25 percent on Friday adding to a 13 percent gain during the previous day's session.

The Italian mid-tier bank said it did not know any reason that might explain the share price moves.

Italy's bourse on Thursday had imposed a ban on orders for the savings shares without price limits and said on Friday it had extended this to Monday. Traded volume was around five times the 30-day average.

Carige's savings shares are convertible into equity and are mostly held by the Carige foundation, a not-for-profit organisation that has a 45 percent stake in the Genoa-based bank. Savings shares also carry a higher dividend than ordinary shares but holders do not have voting rights.

The foundation is looking to sell part of its 45 percent holding ahead of an 800 million euro ($1.1 billion) capital increase.

Shares in Carige have risen 47 percent so far this year, outpacing an 8 percent rise in the Italian banking sector's index, as investors rewarded turnaround efforts at the loss-making lender.

"The savings shares have caught up and surpassed the ordinary ones but I don't see a fundamental reason behind the move, it's more speculative as far as I'm concerned," a Milan-based trader said.

The trader said he was unconvinced by market talk that expectations of a conversion were driving the savings shares higher.

Italian publisher RCS Mediagroup said a week ago it would convert its savings shares into ordinary ones to boost its free floating capital, fuelling speculation others may do the same.

Shares in Carige rose 0.3 percent on Friday, again a 1 percent rise in Italy's banking index.

$1 = 0.7291 Euros Reporting by Valentina Za and Andrea Mandala. Editing by Jane Merriman; editing by Agnieszka Flak and Jane Merriman

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