- Title: Monte dei Paschi shares fall sharply, suspended from trading
- Date: 21st November 2016
- Summary: VARIOUS OF TRADERS WORKING IN FRONT OF SCREENS
- Embargoed: 6th December 2016 11:02
- Keywords: Italian banks Monte dei Paschi di Siena Banca Popolare Unicredit
- Location: LONDON, ENGLAND, UK, SIENA , AND ROME AND MILAN, ITALY
- City: LONDON, ENGLAND, UK, SIENA , AND ROME AND MILAN, ITALY
- Country: Italy
- Topics: Company News Markets,Economic Events
- Reuters ID: LVA00559E0CCT
- Aspect Ratio: 16:9
- Story Text: Shares in Monte dei Paschi di Siena fell 5.3 percent on Monday (November 21) and were suspended from trading as Italian banking stocks came under renewed pressure ahead of a Dec. 4 constitutional referendum that could unseat the government.
"It seems that the referendum in Italy, rather than being seen as a referendum on constitutional reform, which technically it is. That many people are just again seeing this as a potential or an ability for them to protest against the government. Renzi, of course if he were to resign, if he were to step down, potentially could open up another chapter of real disarray in the Italian government. If that was the case, it's possible that if we were to see more elections that we could see the far right populous party coming in and they have suggested they could have a referendum of Italy's membership of EMU, now that could be a big hiccup of course for the whole Euro project," commented Jane Foley, Senior FX Strategist, Rabobank.
Markets worry political instability in Italy would make it hard for Monte dei Paschi to complete a 5 billion euro ($5.3 billion) recapitalisation, needed to stave off the risk of being wound down, with a knock-on effect on other lenders.
Monte dei Paschi CEO Marco Morelli is expected to update the board on the plan's progress at a meeting due to start at around midday on Monday.
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