MILAN May 23 Italy's Banca Popolare di Milano
(BPM) has raised 497 million euros ($677 million)
through the sale of new shares, meeting regulatory demands to
boost its capital base.
BPM, which repaid 500 million euros in state aid a year ago
and is one of 15 Italian lenders targeted by a health check of
euro zone lenders by the European Central Bank before it takes
over supervision of the sector in November, said the rights
issue completed on Friday was 99.5 percent subscribed.
Nine of the 15 lenders are planning to tap investors for
cash for a total of nearly 11 billion euros. BPM's cash call
came after larger rival Banco Popolare successfully
completed a 1.5 billion euro rights issue last month.
A 400 million euro share sale by Credito Valtellinese
starts on Monday, but all eyes are on Italy's
third-largest bank, Monte dei Paschi di Siena, which
is planning to raise 5 billion euros next month.
BPM has estimated that its rights issue would add 1.3
percentage points to its best-quality Common Equity Tier 1
capital, which stood at 7.3 percent of risk-weighted assets at
the end of March. That was still short of an 8 percent threshold
set by the ECB in its review.
The bank's two biggest shareholders before the rights issue
were Italian investor Raffaele Mincione with a 7 percent stake,
held through a fund called Athena Capital, and U.S. investment
fund BlackRock with just over 5 percent.
After a 2011 audit of BPM that unveiled excessive exposure
to real estate among other issues, the Bank of Italy forced it
to apply larger risk-weightings than peers to calculate the
capital ratios that measure financial strength.
Chief Executive Giuseppe Castagna said in May that the bank
would start talks with the regulator after completing the rights
issue, seeking to drop the extra risk-weightings. The capital
increase "is a first step on a road map that we will pursue with
great commitment", he said on Friday.
($1 = 0.7336 Euros)
(Reporting by Valentina Za; Editing by David Goodman)