Unipol shines; Cimbri launches a financial hub with MPS

(Il Sole 24 Ore Radiocor) - The project aimed at creating ‘a major Italian bank within a large financial conglomerate’ is boosting the share price of Unipol on the Milan Stock Exchange. In an interview with the editor-in-chief of Il Sole 24 Ore, Fabio Tamburini, Unipol’s chairman Carlo Cimbri outlined the details and the business rationale behind the deal, whilst also seeking to address the concerns raised in recent weeks by local institutions and politicians.

«‘The most significant developments – as summarised by Intermonte’s analysts – concern the positioning of MPS as the lead bank, through the retention of the word “Siena” in the name of the new group, as well as the retention of its headquarters in Siena/Rocca Salimbeni’. Cimbri noted that, should Intesa Sanpaolo’s public takeover bid for MPS succeed, and following the acquisition of part of MPS’s assets and the subsequent integration with BPER, ‘at the end of the process the enlarged MPS will be 1.5 times the size of the current Monte dei Paschi: it will be a major national bank, on a European scale’. The result “could be a major financial conglomerate that will bring together MPS with Unipol, Italy’s second-largest insurance company, and BPER, in which we hold a 30 per cent stake. “Initially, we will develop all the synergies between the banks and the insurance companies,” explained Cimbri. “In the second phase, we will begin building an even larger bank through the merger of MPS and BPER, which will become the second-largest banking group in Italia , with an extensive distribution network present in all regions.”

Unipol’s chief executive then reassured stakeholders regarding the company’s relationship with the local community and SMEs, as well as the maintenance of employment levels. “We are not buying whatever remains of the MPS ‘scrap heap’, but a bank with all its dignity and solidity,” he remarked. Our presence in the local community is safeguarded through development and development also depends on scale. We need large banks, not least to support businesses expanding abroad.” The spotlight then turned to “the Italian character of the project: Unipol and BPER, like Intesa Sanpaolo for that matter, are 100 per cent Italian, controlled by Italian shareholders. And Monte dei Paschi, which has been distributing insurance products from the French firm AXA for 20 years, will tomorrow begin distributing those from Unipol.”

As for the timetable, Intermonte also notes that the transfer of MPS to Unipol in 2027 and the involvement of BPER in 2028 suggest a slightly more gradual trajectory compared with the initial plan for a full merger of the two banks by the end of 2027, but one that is more realistic in terms of execution. Cimbri, the analysts note, “therefore confirms that the deal is not simply a bank acquisition, but a key step towards building a nationwide insurance-banking platform, with upside potential for profits, dividends and bancassurance that has yet to be fully realised”.

The experts at Equita – which is acting as adviser to Intesa on the OPAS for MPS – are even more explicit: ‘Cimbri’s statements confirm that the ultimate objective is not to “break up” MPS, but to make it the cornerstone of a second Italian banking hub, with MPS as the lead entity and a subsequent merger with BPER. Retaining the brand and the headquarters in Siena reinforces this approach and supports the argument for continuity and the enhancement of MPS’s identity, rather than its downsizing.” Finally, Cimbri himself has once again defended the merits of Intesa’s business plan (“a generous, serious offer, with a strong and rational business plan”) in the face of the public exchange offer launched by Siena: “Proposals – let’s call them creative – on which the market has so far expressed unfavourable views. In my view, the reason is simple,” concluded Cimbri. “Creativity stems from a short-term need: to defend the status quo, not from long-term industrial projects. And the market understands this.”