MILAN (Reuters) - Ailing Italian bank Monte dei Paschi di Siena (MI:BMPS) on Thursday formally approved a last-ditch attempt to raise 5 billion euros (4.17 billion pounds) by year end through a new debt swap offer and a share issue.
The bank, which is expected to need state support, said in a statement the minimum price for the share sale - which has not been underwritten by a consortium of banks - had been set at 1 euro per share.
Sixty-five percent of the share sale will be reserved for institutional investors in Italy and abroad. The bank also said it will extend a debt swap offer to include a 1 billion-euro hybrid financial instrument known as Fresh 2008.
The possibility that the conversion offer will be extended to retail investors holding 2.1 billion euros of the bank's subordinated bonds remains subject to approval from Italian market watchdog Consob, the bank said.
