Moody’s: MPS bids subject to significant uncertainty regarding implementation
Moody’s Ratings states that the announced exchange offers are unlikely to have any immediate impact on the rating
If MPS’s bids for Banco BPM and Banca Generali were to go ahead, they would “diversify profits, reduce reliance on net interest income and strengthen the group’s competitive position in wealth management, asset acquisition, advisory services, asset management and bancassurance. It would also reduce dependence on income derived from MPS’s stake in Assicurazioni Generali”.
This is the view emphasised by Moody’s Ratings, which states that the announced exchange offers are unlikely to have any immediate impact on the rating. Moody’s also believes that the proposed transactions “may entail significant execution risks”. The merger would involve the integration of major organisations operating in the banking, asset management and investment banking sectors, each characterised by different business models, operational infrastructures and corporate cultures.
In particular, MPS would be required to complete a number of integration processes, including the proposed merger with Banco BPM and the takeover of Banca Generali, in addition to the integration with Mediobanca that is already under way”. The proposed transactions therefore remain subject to “significant uncertainty regarding their execution, including approval by MPS shareholders, the launch and successful completion of the proposed exchange offers, and the obtaining of all necessary regulatory, supervisory and competition law approvals”.
