Italy preparing to take controlling stake in Monte dei Paschi - sources

Rome

ITALY is preparing to take a 2 billion euros (S$3 billion) controlling stake in Monte dei Paschi di Siena as the bank's hopes of a private funding rescue fade following Prime Minister Matteo Renzi's decision to quit, two sources close to the matter said on Tuesday.

The government is already the ailing bank's single largest shareholder with a 4 per cent share, but is planning to buy junior bonds held by ordinary Italians to take the stake up to 40 per cent, the sources said.