Bank of Italy, bourse watchdog monitoring MPS
Uncertainty surrounding 3-bn-euro capital increase30 December, 13:20
Stocks plunged nearly 6% as the bourse opened the week Monday, just a percentage point shy of the limit before trading is frozen. Shortly after shares recovered the loss and by midday were up 1.04%. Investors have been spooked by uncertainty surrounding a turnaround plan for MPS, Italy's third-largest and the world's oldest. MPS management had argued strongly to complete the cash call in January but shareholders forced a delay until mid-May. If it fails to generate enough capital to repay State aid, the bank risks nationalization.