Monte dei Paschi gets 25 million euros from three banking foundations

MILAN (Reuters) -Fondazione CRT has committed 5 million euros ($5 million) towards a new share sale at Monte dei Paschi di Siena, a CRT source said, bringing the total pledged this week by Italian banking foundations to 25 million euros.

CRT’s decision comes after fellow foundations Fondazione Cariplo and Fondazione Compagnia di San Paolo this week answered an informal request by Italy’s Treasury to back Monte dei Paschi’s capital raising efforts.

Cariplo and San Paolo have each approved a 10 million euro investment in MPS, pledging to mop up unsold shares in the up to 2.5 billion euro share sale which runs until Monday.

MPS is braving stormy markets to raise money to lay off staff and bolster its capital reserves five years after an 8 billion euro bailout and a failed re-privatisation attempt by the Treasury in 2021.

In an effort to boost the take-up, Italy’s Treasury, which owns 64% of Monte dei Paschi and oversees banking foundations, rushed to persuade more banking foundations this week to support the cash call.

The share issue is covered for up to 1.6 billion euros by Italian taxpayers, while the rest needs to come from private investors due to European Union state aid rules.

($1 = 1.0018 euros)

(Reporting by Andrea Mandala, writing by Valentina Za; editing by Agnieszka Flak)