Marco Morelli, Italy’s country head at Bank Of America Merrill Lynch, is the frontrunner to replace Fabrizio Viola as chief executive of Monte dei Paschi di Siena, a source with knowledge of the matter said.
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A sign for Banca Monte dei Paschi di Siena.
The Tuscan bank said on Thursday it was working to appoint a successor quickly and that Viola would remain in place until a successor is found.
The bank, Italy’s third largest, in July approved a bailout plan that envisages a capital increase of up to 5 billion euros ($5.6 billion) and the sale of 9.2 billion euros in net non-performing loans by the end of 2016 to avert the risk of being wound down.
CAPITAL INCREASE DELAYED? Shares in Monte dei Paschi closed down 2.2 percent at 0.2391 euros on Friday, valuing the bank at less than 700 million euros.
However, one of the sources said the fund raising was now more likely to be launched in January or February of 2017, a delay that should allow Italy’s political situation to become clearer.
Viola, who joined Monte dei Paschi in 2012 to turn the bank around, has presided over two successive share issues since 2014 that raised 8 billion euros and investors were reluctant to back him a third time, bankers said.
“Fabrizio Viola, called upon to head the bank at a moment of extreme difficulty for the establishment, leaves it solid and in the black with a plan unveiled past year, on July 29th, comprising a definitive structural solution for bad debts”, the bank said.
Further complicating the picture is a constitutional referendum on which Renzi has staked his job, expected to be held in late November or early December. Morelli was chief financial officer at Monte dei Paschi before he left in 2010.
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After the European Union stress test, Viola had announced a 5 billion euro capital increase from private sources.
