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Banco Popolare scraps dividend, says no new issues
March 20, 2012 / 5:52 PM / 6 years ago

Banco Popolare scraps dividend, says no new issues

MILAN, March 20 (Reuters) - Italy’s Banco Popolare said it will not need to tap markets in 2012 to boost capital and scrapped its dividend after impairments on past mergers dragged it into a full-year loss of 2.2 billion euros.

The Core Tier 1 ratio, a standard of high-quality capital held against risky assets, was 7.1 percent at the end of December, from 6.5 percent in September, the bank said on Tuesday.

The mid-tier lender said full-year net income, before the impairment of goodwill would be 574 million euros, compared to 308 million euros a year ago.

Banco Popolare must plug a 2.7 billion euro capital shortfall by June to meet tougher requirements set by the European banking Authority.

The mid-tier bank has ruled out the need for a capital increase, and is hoping it will be allowed to calculate a 1 billion euro convertible bond as core capital without having to convert it.

In February, the lender also launched in February a 1.2 billion euro hybrid bond buyback, which it said would boost its core Tier 1 by 24 basis points. (Reporting by Antonella Ciancio)

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