ROME: A tender to sell the good assets of four small banks Italy rescued from bankruptcy in November has been reopened after three binding bids submitted last month were rejected, a source familiar with the matter said on Monday. The source said the three bids had not been accepted as they were subject to a number of conditions, and suitors who had presented non-binding offers have now been invited to bid again. There had been around 10 non-binding bids, the banks’ chairman said in May.
Il Sole 24 Ore reported on Saturday that the idea of selling the four banks together was being dropped in favour of disposing each lender separately. The source was unable to confirm this. Making use of a deposit guarantee fund, Italian banks have pumped 3.5 billion euros ($4 billion) into Banca Marche, Banca Etruria, CariChieti and CariFerrara to cover past losses and provide them with 1.8 billion euros in fresh capital.
The value of the four lenders has already been written down to 1.4 billion euros due to restructuring charges. Bids submitted so far are expected to have amounted to a fraction of that figure, which would imply a loss for Italy’s struggling banking system. After a deadline for binding offers expired last month, the Bank of Italy said it had received three bids. U.S. investment funds Apollo Global Management and Lone Star were among the bidders, sources said. Il Sole 24 Ore mentioned Banca Popolare Emilia Romagna , UBI Banca and Popolare di Bari among possible bidders now that the tender had reopened.
UBI said it was not interested the lenders, while BPER could not immediately be reached for comment. A source close to Popolare di Bari said the bank may be interested in CariChieti. Sources familiar with the matter have said the main factor dragging down the valuation of the four banks – in addition to a weak operating performance – is the quality of the loan portfolio, despite the fact that loans to borrowers deemed insolvent were spun off in the rescue.
