Italian govt approves decree to rescue Monte dei Paschi

[ROME] The Italian government approved a decree early on Friday that will open the way for the rescue of Monte dei Paschi di Siena after the world's oldest bank failed to win backing from investors for a vital capital increase.

Prime Minister Paolo Gentiloni told reporters his cabinet had authorised the creation of a 20-billion-euro (S$30 billion) fund to prop up Italy's embattled banking sector, with Monte dei Paschi expected to be first in line for help.

"Today marks an important day for Monte dei Paschi, a day that sees it turn a corner and able to reassure its depositors," Mr Gentiloni said.

REUTERS