MILAN May 17 Italy's Veneto Banca will consider
merger opportunities only after an ongoing asset quality review
by the European Central Bank, financial daily Il Sole 24 Ore
cited Chairman Francesco Favotto as saying.
The unlisted bank is one of 15 Italian lenders being
scrutinised by the European Central Bank in a check-up of
banking assets. The ECB will officially take on oversight of
euro zone lenders from national authorities in November.
The Bank of Italy has told Veneto Banca to consider possible
mergers as part of efforts to strengthen Italy's fragmented
banking system and shore up lenders' capital base.
There has been speculation about a tie-up between Veneto
Banca and Banca Popolare di Vicenza, another cooperative lender
located in Italy's wealthy northeast, but Favotto said this was
out of the question.
"Such a move would only bring economies of scale, but not
economies of scope," he told the paper, adding that the lender
was looking for options that would give added value to the bank.
"We will see after the asset quality review. One
possibility, also highlighted by the report delivered to us in
recent days by advisor Goldman Sachs, is to place Veneto Banca
in the European context, maybe via an alliance with foreign
institutes. But we are still thinking about this."
Favotto said this would be one of the topics discussed
during a meeting with the Bank of Italy on Monday, along with
the lender's plans to establish an advisory board.
Favotto said the bank's planned sale of its stake in private
banking unit Banca Intermobiliare was "in the final
"I confirm that there are four offers, one of which
particularly significant," Favotto said. "A binding offer will
arrive on the board of directors' table June 17 or July 1."
The stake sale, along with a capital increase due to be
launched on June 20 and concluded by end-July and the conversion
of a 350 million euro bond into equity, is expected to raise the
lender's Common Equity Tier 1 ratio to 11.3 percent, he said,
above the 8 percent minimum requirement set by the ECB.
The bank could not immediately be reached for comment.
(Reporting by Agnieszka Flak; Editing by Robin Pomeroy)