July 30, 2019 / 3:18 PM / 4 months ago

Italy's FITD fund to invest up to 636 million euros in Carige

FILE PHOTO: The logo of the Carige bank is seen in Rome, Italy September 20, 2018. REUTERS/Max Rossi/File Photo

MILAN/ROME (Reuters) - Italian banks will spend up to 636 million euros (£582.34 million) to keep ailing rival Banca Carige (CRGI.MI) in business, according to a senior executive at the banking fund that approved the investment.

The FITD depositor guarantee fund financed by the country’s lenders on Tuesday backed the latest rescue plan for Carige, agreeing to shoulder the bulk of a proposed 900 million euros cash injection.

FITD Director General Giuseppe Boccuzzi said the fund would convert into equity a 313 million euro bond issued by Carige and take part in a new share issue for 238 million euros. The fund also stands ready to mop up any new shares left unsubscribed by the bank’s current shareholders for up to 85 million euros.

Reporting by Stefano Bernabei and Elvira Pollina, writing by Valentina Za

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