Bank of Italy calls for review of BPVN, Popolare Italiana merger terms - report |
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Wed, 17 Jan 2007 09:08
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MILAN (AFX) - Bank of Italy has called for a review of the terms of the proposed merger between Banco Popolare di Verona e Novara and Banca Popolare Italiana, the daily Il Sole 24 Ore said citing financial sources.The central bank is concerned about plans that BPI will distribute an extraordinary dividend totaling a maximum of 1.5 bln eur, or more than 2 eur per share, to its existing shareholders before the merger, it said.The payout would lead to a temporary decline in BPI's capital adequacy ratios prior to the merger, scheduled July 1, it said.BPVN held a board meeting yesterday to discuss the issue and BPI's board is due to convene today, it added.BPVN is expected to propose guarantees regarding BPI's balance sheet, the newspaper said.The issue is another snag in the merger process, ahead of a BPI shareholder meeting scheduled Saturday to decide whether to reinstate CEO Divo Gronchi who was suspended after being convicted by a Brescia court in the Bagaglino/Italcase case.Under the merger agreement announced in October, the two banks will create an umbrella holding company that will offer 0.43 shares for every BPI share and one of its own shares for every BPVN share.The new bank will be Italy's largest cooperative bank, and the third largest retail bank in terms of branches.philip.webster@afxnews.compw/tcCOPYRIGHTCopyright AFX News Limited 2006. All rights reserved.The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
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