MILAN (Reuters) – Shareholders in Monte dei Paschi di Siena BMPS.MI approved on Sunday a long-awaited bad loan clean-up plan aimed at easing the sale of the state-owned bank to a healthier rival.
Italy has worked for two years on the plan, which gained final approval from the European Central Bank in September and must be completed by Dec. 1.
Rome bailed out Monte dei Paschi in 2017, acquiring a 68% stake for 5.4 billion euros ($6.3 billion). To meet conditions agreed at the time with European Union competition authorities, it must cut that stake before the bank approves 2021 earnings.
The ‘Hydra’ scheme approved on Sunday at an extraordinary shareholders’ meeting will lower Monte dei Paschi’s impaired loans to 4.3% of total lending,