Monte dei Paschi's board is expected to approve state aid request after capital increase failed

 
Courtney Goldsmith
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ITALY-BANK-MONTE DEI PASCHI DI SIENA-HEADQUARTERS
The Monte dei Paschi board will meet today (Source: Getty)

Monte dei Paschi di Siena announced today its plan to raise €5bn (£4.2bn) of capital by the end of the year had failed.

The bank's board is now expected to approve a request for state aid when it meets later today.

Italian parliament yesterday agreed to a bailout package of €20bn (£16.9bn) bailout for the country's banks.

The country's third-largest bank said it failed to secure investors and sell new shares, so it scrapped a debt-to-equity conversion offer that had raised €2bn, Reuters reported. It is returning bonds tendered under the swap.

Read more: Monte dei Paschi fails to attract anchor investors to its share offer

Monte dei Paschi said it would not pay fees to investment banks that had worked to place its shares or on its planned bad loan sale, including its advisers JPMorgan and Mediobanca.

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