A Battle for the Oldest Bank in the World Unfolds in Italy

Банк Monte dei Paschi di Siena ведет свою историю с 1472 года.

Italy's largest bank, Intesa Sanpaolo, on Monday made an unsolicited offer to acquire competitor Monte dei Paschi di Siena (MPS) for €30.6 billion. This was reported on Intesa Sanpaolo's website.

If successful, the deal will create the second largest banking group in the eurozone by market capitalization, worth €126 billion, notes The Guardian. It will only be surpassed by Spain's Banco Santander, which has a capitalization of €155 billion.

The offer from Intesa Sanpaolo came just hours after Italy's fourth largest bank, Banco BPM, sent a letter to MPS on Sunday proposing a merger. This deal, according to Banco BPM's plan, would create a "new national champion" and the second largest bank in the country – surpassing Unicredit by market capitalization, which would be around €50 billion.

The confrontation is unfolding two years after MPS returned to private ownership. The bank was rescued by the Italian government in 2017, and in 2023-2024, MPS was privatized. Since then, this bank has repeatedly been referred to as a potential takeover target.

However, last year MPS surprised the market by acquiring and merging with competitor Mediobanca in a €16 billion deal.

Intesa's unexpected offer could have implications for the historic MPS brand, which has its roots dating back to 1472. Intesa's plan involves splitting the bank: selling 635 MPS branches and the Unipol Assicurazioni insurance brand itself. In return, Intesa will retain Mediobanca, as well as a 13% stake in the Generali insurance group.

This deal structure is expected to help avoid antitrust issues.

Generali is the largest Italian insurance company, serving about 75 million customers. It manages a significant portion of Italy's pension savings and has large investments in the country's government debt.

The insurance company has long attracted the attention of potential buyers due to its dominant position in the insurance and asset management market, writes Bloomberg. Intesa attempted to strike a deal in 2017 but ultimately abandoned the idea.

Intesa Sanpaolo's CEO Carlo Messina stated at that time that he did not see sufficient value in the deal.

Shares of Monte Paschi surged by as much as 12%, reaching their highest level since 2022. Intesa's shares fell by 4.5%, while Generali rose by 2.8%.