The great financial games are heating up government buildings. They are underway two financial warsin which Palazzo Chigi wants to have its say, in perfect alignment with the Treasury Ministry led by Giancarlo Giorgetti and supported by the undersecretary Federico Freni. It is enough to tell a small anecdote, which allows us to immediately enter into the story. When the number one of UnicreditAndrea Orcel, summoned the board of directors of his bank to announce the hostile takeover on Bpm benchtook care to send a generic message (a couple of hours before the council) to Prime Minister Giorgia Meloni. Palazzo Chigi and the Treasury at that point exchanged some ideas to understand what was happening. Giorgetti had already learned of the takeover and communicated it to the prime minister. Which obviously didn’t take it well. At that point she certainly didn’t need to talk to the banker to find out what Giorgetti had already told her. Once the talks with Unicredit were interrupted, the study to prepare defenses for a project conceived outside the government’s wishes began immediately.
We are therefore at the beginning of our story, which I will try to make simple despite being a complicated affair and which in fact concerns at least six Italian financial institutions, two foreign banks, the most important Italian insurance company (Generali) and various public bodies.
The two matches are those that concern the future of Banco Bpm and Generali. The first is a bank that does not have a real controlling shareholder (although now things are changing and the French Crédit Agricole, which until recently had maintained a 10% stake, can now count on 20%) and which works in the richest territory in Italy. The second is the most important insurance company in Italy (third in Europe) which manages policies and savings, mostly of Italians, for around 850 billion.
The fundamental key to this whole affair, according to Palazzo Chigi, is the defense of Italian savings. Right at the end of the Renzi government, Unicredit sold a fundamental piece of Italian savings to the French Amundi, controlled by Crédit Agricole (Pioneer, 225 billion in managed savings). And today the government fears that Generali will end up foreign or worse make agreements (like the ones they are studying at the moment) with the French which will only show their true face after a delayed outbreak: a disguised sale.
To avoid these risks, Chigi and Tesoro had thought about in recent months form a good-sized banking groupcreated by Banco Bpm, by the reorganized MPS (in which the State still boasts a significant share) with the potential participation of Anima (a savings management company for which Bpm launched a friendly takeover bid in recent months). Thus the third banking hub would be born, with a capitalization not far from 25 billion: a size that would have allowed the purchase of even a significant share of Mediobanca, i.e. the key to accessing control of Generali.
Unicredit’s takeover bid for Banco Bpm falls into this scenario. Which, if successful, cancels not only the birth of a new national champion, but above all the maintenance of control of Generali in Italy. This is why today at Palazzo Chigi there is great irritation. Orcel has paralyzed the operations of Banco BPM, blocked MPS and at the same time compromises the government’s plans for Mediobanca and Generali.
As you can see, the story is very complicated. It is therefore worth a summary. Palazzo Chigi looks to Generali with a view to defending the significant managed savings. To conquer Generali you need to control Mediobanca. MPS could be the pivot with which to do this. And it makes no difference, this is exactly the term used in those parts, as to who makes it safe: until a few months ago it could have been a group of private individuals (appreciated by Chigi) with MPS and BPM. And if today Orcel has paralyzed Bpm it is a mess for the government, but not irreparable: there is still MPS with Caltagirone-Del Vecchio (together they own just under 20% of the Sienese institute) which has the resources to proceed. And here times are important. And at the moment they play in favor of Orcel and the current Generali structure.
There are two weapons that the government is studying. The first is the Consobwhich is an independent authority and will do as it pleases. But it could break the deadlock in a few weeks if it forced Unicredit to reformulate the offer for Banco Bpm more clearly and above all if it freed the bank led by Castagna from the so-called passivity rule, which prevents it from carrying out the takeover of Anima by making itself more complicated for Unicredit to digest. This is a hypothesis in which Palazzo Chigi does not believe much, not because it is not technically valid, but simply because it is not available to them. The temptation – actually more than a temptation – is therefore to resort to the so-called Golden power which would block the operation (a hypothesis also on the table for Generali). One of the profiles being evaluated is the presence of Unicredit in Russia, as is known under sanctions, but which still generates around 1 billion margin per year for Orcel’s bank and which for this reason the banker, against everything and everyone, he doesn’t want to give up. Orcel has historically been closely linked to Moscow. As head of Merrill Lynch, it was he who hired and trained his younger brother Riccardo to place him at the head of the emerging market desk. The brother then became for years the European head of Putin’s so-called bank, the Russian VtB. And Orcel senior, for example, as soon as he arrived at UBS in 2012, made the coup of immediately winning a key role in the placement of a 1 billion dollar perpetual bond with Vtb. It is clear that today he does not want to give up the bone that makes his shareholders rich and his shares heavy which he will then use to buy Banco Bpm. Well, his Russian weakness is a Trojan horse for the government. And for the exercise of power that makes Orcel’s climb more difficult.
The government knows perfectly well that times are tight and that they are not in their favour. He would be somewhat embarrassed in allowing MPS, now stand alone, to carry out an operation on Mediobanca, but he could justify it for the safety of Italians’ savings which risk ending up across the border.
So far none of our actors have been received by the prime minister. None of them manage to present their reasons. At Palazzo Chigi they have a simple idea and they intend to pursue it with those who are there: not a euro of Italians’ savings can end up abroad and especially in France. And from what we understand in this complicated story, Palazzo Chigi does not consider Orcel and Philippe Donnet (the head of Generali) two heralds of their managed sovereignism.
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