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Monte dei Paschi debt-to-equity swap won't include FRESH notes

Published 01/12/2016, 11:19
Updated 01/12/2016, 11:31
© Reuters. A Monte dei Paschi di Siena advertisement is seen on a screen in a bank window in downtown Milan

MILAN (Reuters) - Italian bank Monte dei Paschi di Siena (MI:BMPS) said on Thursday it had not been able to include a nominal 1 billion euros in so-called "Fresh" financial instruments issued in 2008 in its offer to convert part of its debt into newly-issued shares.

The debt-to-equity swap offer is a key plank of a 5 billion euro (4.19 billion pound) capital raising plan the bank is striving to complete this year to stave off the threat of being wound down.

"The result of the analyses conducted so far regarding the possibility of including the "Fresh 2008" issue in the voluntary conversion offer, did not allow the bank for the time being to proceed with the plan," Monte dei Paschi said in a statement.

Monte dei Paschi CFO said on Wednesday the inclusion of the Fresh notes looked "quite difficult" given regulatory and time constraints.

The Italian press has reported that a group of funds led by Attestor Capital had bought the Fresh notes with the idea of converting them, but they failed to reach an accord on the terms of the conversion with the bank.

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