Risk Banking: Mediobanca’s Countermove

In jargon it is called "risk banking": as in the popular board game, managers of Italian banks deploy their troops to win the competition, looking for savings and synergies. There was a time when the Italian banks were the great pariahs of Europe, drowned by unscrupulous managers and bloody recapitalizations. That era is over: after a difficult decade, recalled the president of the Italian banking association (ABI) Antonio Patuelli, the national industry of credit and savings feels "with a great push to strengthen".

Now the issue comes to life and there are twists and turns. Mediobanca has in fact responded to the banking risk that sees it at the center of the dances and raised defenses against the public exchange offer of Monte dei Paschi. The bank, headed by Alberto Nagel, has announced a public offering of «all the shares of Banca Generali», that is to say a package of 13.1%. 

As a matter of fact, the institute of Piazzetta Cuccia puts at stake its share in Generali in exchange for 100% of the subsidiary. Mediobanca had already considered the acquisition of Banca Generali in 2020 but had been rejected by the relevant shareholders of the bank. At the time it was an «M & A» operation that also provided for Piazzetta Cuccia to go through a capital increase, something less appreciated by shareholders. This time the CEO, Alberto Nagel, has planned a public transaction on the shares of Banca Generali. The initial reaction of the market was very positive: both stocks involved in the transaction rise. Sign that the operation as it is planned is welcome and well received. 

The transaction could have disruptive outcomes on the geographies of finance and for this reason is already raising questions among investors and business bankers. For example: How can Mediobanca launch an offer under passivity rule? On what votes can Nagel count?

What is the expected time frame?

In the coming weeks, Mediobanca will submit requests for authorisations to the various authorities involved, from the ECB to the Antitrust and the Golden Power committee, as normally foreseen for operations of this type.

Approvals are expected in September, while the accession period will be between the end of this month and October. The project should be completed by autumn 2025.

What will happen to the ops of Montepaschi? After the assembly that before Easter has authorized the operation, Mps waits for the authorizations of the Supervision before launching the ops on Mediobanca. CEO Luigi Lovaglio wants to start the offer at the end of June to close in July but now the countermove by Mediobanca could disrupt Siena’s plans.