It’s crunch time for embattled Italian lender Banca Monte dei Paschi di Siena SpA.
All eyes are now on the Italian government, after it became clear late Wednesday that BMPS had failed to raise enough money to stave off a collapse. A state bailout is inevitable and could be announced as soon as Thursday, according to media reports.
Shares in BMPS sank as much as 10% on Thursday morning, but lately were trading in the green.
Monte dei Paschi has in recent weeks raced to raise €5 billion ($5.2 billion) from private investors to shore up its balance sheet and avoid being wound down by European regulators. However, it has run into major challenges. For example, uncertainty following the Italian referendum in early December dissuaded key investors to take part in the private rescue plan.