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Carige is planning about capital increase and bad loans

 

The board of Carige is preparing to face a crucial meeting these days. The meeting is aimed at finding a strategy to calm down the Bce, which is ready to apply the strict measures of the surveillance regulation, in the case it would judge as not satisfying the actions promoted by the board of directors.

The board, led for the first time by Paolo Fiorentino, should define a new plan for the disposal of the non performing loans, that would replace, through an ad hoc vehicle, the plan developed by the former Ceo, Guido Bastianini, who was dismissed from its position following the request for no confidence by the main investor of the bank, as well as Vice President, Vittorio Malacalza, who controls 17.58% through its company Malacalza Investimenti.  The board will also have to give Fiorentino the responsibility to dispose of the real estate assets and the Carige shares and to start defining the amount of the probable capital increase. Bastianini, who hasn’t resigned yet from the board, speculated on a recapitalization of 450 million together with Lme initiatives and the conversion into Tier 1 and Tier 2 bonds ( perpetual or subordinated).  A strategy that Malacalza didn’t like, particularly the part regarding the bond conversion.

The preferred solution for the Carige Vice President is instead a capital increase by the shareholders effective and decisive for the bank.

But a capital increase is likely to be higher than 450 million. Probably 650, but some analysts speculate also 800-900 million. Everything depends on how much the bank will be able to collect through the disposal of the npls and the appreciation of its assets, as well as the cost reduction.

Concerning the impaired loans, this week the securitisation of 938 million bad loans assisted by Gacs is supposed to finish, through the placement of the securities to institutional investors, with a value around 31% of the nominal one.  There are though other 2.4 billion Npls that need to get out of the bank, these bad loans are included in a total of 7 billion Npe (non performing exposures). Fiorentino aims at a better management of these exposures and he’s intending to have an internal specialized department to look at them, in order to optimize the collection activities. Also regarding the npls, the new Ceo focused on the discordant values of the npls, comparing the data possessed by the banks and the those of the evaluation by Prelios. Concerning the real estate assets owned by Carige, they are estimated around  700 million euro, but they include also buildings that may have a higher value. For instance, the London office of the bank, in Hornton Street, valued at one million euro. There are then shares such as that of Autostrada Dei Fiori (valued around 91 million) and the quota of Banca d’Italia exceeding 3%, which is equal to one percent.