ROME Oct 4 The Bank of Italy is confident there
are alternatives to liquidation for four Italian banks rescued
from bankruptcy last year if their planned sale falls through,
its Director General Salvatore Rossi said on Tuesday.
A European Union deadline of Sept. 30 for the sale of the
troubled banks was extended last week, but UBI Banca's
move to buy three of them has not yet been approved by the
European Central Bank (ECB).
Asked whether there was an alternative to liquidation if
Italy failed to find a buyer by the new deadline, Rossi said:
"There are possibilities and instruments to find a positive
solution to this problem that do not involve liquidation".
Neither Italy nor the European Union have said when the
revised deadline will expire.
Italy's economy minister said on Monday that nationalising
troubled Italian banks was not necessary, as concerns mounted
that a plan to rescue lender Banca Monte dei Paschi di Siena
might come unstuck.
Monte dei Paschi, the biggest of Italy's troubled banks, has
agreed a new turnaround plan based on a 5 billion euro ($5.6
billion) cash call and the sale of 28 billion of bad loans, but
investors' appetite is in doubt as markets fret over political
uncertainty and a Dec. 4 referendum.
Two previous deadlines for the sale of the four smaller
lenders, which together have 950,000 clients according to the
Bank of Italy, expired without a deal being struck and Rossi
said they were trying to find a solution against a backdrop of
difficult market conditions.
Il Messaggero newspaper reported at the weekend that the ECB
had told UBI Banca that it would have to raise 600 million euros
in fresh capital if it wanted to buy Banca Marche, Banca Etruria
and CariChieti, but it was only prepared to raise up to 400
Rossi said the ECB was "rightly worried that the bank or
banks that eventually buy (the lenders) should be solid".
($1 = 0.8953 euros)
(Reporting by Stefano Bernabei; Writing by Crispian Balmer;
Editing by Alexander Smith)