February 22, 2017 / 10:47 AM / 2 years ago

Italy sees deal with EU over Monte dei Paschi in a few weeks

A man walks on a logo of the Monte Dei Paschi Di Siena bank in Rome, Italy September 24, 2013. REUTERS/Alessandro Bianchi/Files

MILAN (Reuters) - Italy expects to clinch a deal with European authorities over a state bailout of loss-making bank Monte dei Paschi di Siena (BMPS.MI) in a few weeks, top Treasury official Fabrizio Pagani said on Wednesday.

Monte dei Paschi asked for state support last year after failing to raise 5 billion euros (4 billion pounds) on the market to shore up its capital. This will need to be approved by the European Commission.

“Talks have just began. They are not more difficult than anticipated and will require a few weeks,” Pagani said on the sidelines of a conference in Milan.

Pagani’s optimism may be premature. The Commission typically takes several months to clear banking cases because of the complexity.

Denying press reports at the weekend, Pagani said the Commission had not asked for changes to the government decree which detailed the bailout.

Commission spokesman Ricardo Cardoso said the EU state aid regulator was reviewing the recapitalisation of the bank.

“The Commission is working with the Italian authorities and the supervisory authorities to assess the compatibility of the planned intervention by the Italian authorities with EU rules,” he said.

Several Italian newspapers reported at the weekend that an accord over Monte dei Paschi’s bailout plan could take months and that Brussels wanted Italy to amend the conditions of the rescue.

Reporting by Giulio Piovaccari; Additional reporting by Foo Yun Chee in Brussels; Writing by Francesca Landini; Editing by Valentina Za and Mark Potter

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