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EXCLUSIVE-Italy invites pitches for advice on privatising Monte dei Paschi - sources

* Rome must cut 68% stake under terms of 2017 bailout

* Advisers have until Nov. 17 to submit proposals - sources

* UniCredit seen as preferred merger partner - sources

* Monte dei Paschi faces capital shortfall (Adds details on privatisation plans)

By Pamela Barbaglia, Valentina Za and Giuseppe Fonte

LONDON/MILAN/ROME, Nov 13 (Reuters) - Italy’s Treasury asked financial and legal advisers on Friday to pitch for a role in the privatisation of Monte dei Paschi as it aims to secure a merger deal for the ailing lender, two sources familiar with the matter told Reuters.

Investment banks and law firms have until Nov. 17 to submit their proposals and a decision is expected within a week, the two sources said, speaking on condition of anonymity as the matter is confidential.

Rome owns 68% of Monte dei Paschi after a 2017 bailout.

A spokesman for the Treasury declined to comment while Monte dei Paschi was not immediately available.

Rome sent out requests for proposals (RFPs) on Friday asking advisers to quote a price for their services to support the Treasury in finding a new owner for its stake.

The mandates will last 12 months, the sources said.

The move comes as Rome seeks ways to address pending legal claims worth 10 billion euros ($11.8 billion) in aggregate that sources say are the main hurdle to finding a buyer for the Tuscan bank.

UniCredit is seen as the preferred buyer for Monte dei Paschi, banking sources have said, but any deal would only come after the Treasury acts to remove the legal risks while also injecting fresh capital.

In its nine-month financial report, Monte dei Paschi said the Treasury intended to honour commitments taken with the European Union at the time of the bailout that in 2017 handed the state its 68% stake.

To this aim, the Treasury wants to carry out “a market transaction finding an anchor investor and/or a banking partner of high standing to restore the bank’s competitiveness,” Monte dei Paschi said in the document.

Monte dei Paschi flagged a projected capital shortfall on Friday, saying the government stood ready to support it while also seeking a merger with a stronger peer. ($1 = 0.8456 euros) (Reporting by Pamela Barbaglia in London, Valentina Za in Milan and Giuseppe Fonte in Rome; editing by Barbara Lewis)