July 16, 2018 / 4:45 PM / a month ago

Monte dei Paschi says granted state guarantee on bad loan securitisation sale

MILAN (Reuters) - Italian bailed-out bank Monte dei Paschi di Siena (BMPS.MI) said on Monday it had been granted a state guarantee on a 24 billion euro (21.17 billion pounds) bad loan securitisation sale which is a key plank of its restructuring plan.

The entrance of Monte dei Paschi bank headquarters is seen in downtown Siena, Italy, October 27, 2017. Picture taken October 27, 2017. REUTERS/Stefano Rellandini

The state guarantee wraps the least risky portion of the deal — 2.92 billion euros in senior notes issued by the securitisation vehicle that purchased the bad loans.

Italy introduced the state guarantee scheme back in 2016 to ease bad loan sales by banks.

Reporting by Valentina Za; Editing by Crispian Balmer

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