When asked by CNBC about Monte dei Paschi, UniCredit CEO said “we’ll be seeing”

MILAN (Reuters), -UniCredit Chief Executive Andrea Orcel did not rule out the possibility of the Italian bank reevaluating a possible acquisition of Monte dei Paschi di Siena, following talks that ended in 2021.

Monte dei Paschi is 64% controlled by the Italian state. This must be reduced in order to meet the European Union’s reprivatisation commitments at the time of the bailout.

“I believe Monte dei Paschi is moving in a new direction in their strategy. They’re doing it all at the moment. “They’ve raised capital, they’re rationalising bank, they are restructuring bank,” Orcel told CNBC.

“They do a great job. And that’s all there are to it. They need to do this, and then we will see,” he replied when asked about a Reuters story that UniCredit was still being considered as a buyer for Monte dei Paschi.

In December, Monte dei Paschi raised 2.5 Billion Euros in capital, despite the rocky markets. This was to finance thousands in voluntary staff departures and reduce costs.

Giorgia Melonsi, the Prime Minister of Italy, stated in December that Monte dei Paschi was a bad situation and that a reprivatisation could help Italy have several large banking institutions.

According to a source from Meloni’s cabinet, the comment implied that the government was not confident about Orcel after the failure of negotiations – which could give Banco BPM an advantage.

Orcel praised Meloni’s right-wing government, saying that it had made “tough” economic choices from the beginning and that the budget for 2023 was “quite solidly and cautious.”

“This government has pledged to continue (previous Prime Minster Mario) Draghi’s policies,” he stated.

(Reporting by Valentina Z, editing by Gianluca Selaro, Kirsten Dovan)