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Italy Just Bailed Out The World's Oldest Surviving Bank

Tyler Durden's picture





 

Some people know Banca Monte dei Paschi di Siena as one of the biggest banks in Italy (lately best known for being either halted down, about 90% of the time, or up, the remainder) with 3,000 branches, 33,000 employees and 4.5 million customers. Others know it for being the world's oldest surviving bank, founded in 1472 by the magistrate of the then city-state of Siena. Most will henceforth know it as the first Italian bank bailed out in 2012 using the old 2009 ponzi scheme known as "Tremonti bonds", whereby the bank sells bonds to a guaranteed buyer - the Italian government - receiving critical cash to continue operating in exchange for, well, promises, and sharing its balance sheet with the much more "viable" sovereign, whose bonds were trading above 6% at last check. The initial bailout bid: €1 billion in Tremonti bonds with speculation the number will be realistically up to €4 billion. The final number: much, much higher, but it likely won't be known for at least days. Which incidentally is an event which was largely expected. Recall on June 13 we wrote: "Forget Three Months: Italy May Have Two Weeks Tops, As "It Already Is Where Spain Is Heading." It is now 13 days later and the bailouts have begun.

The chart of BMPS.IM says it all. Luckily the final outcome will be resolved in under 20 cents.

And from Bloomberg.

Italy has approved a decree to help banks to boost capital through the sale of bonds to the government, as Banca Monte dei Paschi di Siena SpA prepares to raise at least 1 billion euros ($1.3 billion) using the securities, a government official said.

 

Ministers passed the measure at a Cabinet meeting in Rome today, said the official, who asked not to be identified because the matter isn’t public yet. The legislation probably will be similar to the decree approved in 2009 that allowed lenders to issue so-called Tremonti bonds, which were named after then- Treasury Minister Giulio Tremonti, a person familiar with the matter said earlier.

 

Monte Paschi, which is among Italian lenders that must raise capital as part of Europe’s plan to end the sovereign-debt crisis, has a capital shortfall of 3.3 billion euros, according to the European Banking Authority. The bank must also repay 1.9 billion euros of state aid provided in 2009.

 

Monte Paschi was one of four lenders which got state aid under the previous law. Banco Popolare SC received 1.45 billion euros, Banca Popolare di Milano Scarl obtained 500 million euros and Banca Piccolo Credito Valtellinese Scarl got 200 million euros.

 

“The government measure is clearly being done to help Monte Paschi,” said Angelo Drusiani, who manages about 3 billion euros at Banca Albertini Syz & C. in Milan. “I don’t think other banks need to apply for these securities to raise capital,” he said.

 

Monte Paschi fell 3.7 percent to 19.39 cents before being halted for volatility in Milan, giving the bank a market value of 2.4 billion euros. The stock has dropped 23 percent this year, compared with a 3 percent decline of the Bloomberg Europe Banks and Financial Services Index.

 

Monte Paschi’s board meets today to approve a plan that includes capital measures to comply with the European Banking Authority’s targets. The Siena, Italy-based bank may sell at least 1 billion euros of bonds to the government as part of its plan, said a person yesterday. The bank may also restructure the old issue, said the person.

 

The lender has already covered more than 2 billion euros of its capital shortfall through the conversion of hybrid bonds and the implementation of new internal risk models, Chief Executive Officer Fabrizio Viola said last month.

 

Monte Paschi’s first-quarter profit dropped 61 percent to 54.5 million euros after setting aside more money for bad loans, it said May 15. Loan-loss provisions in the quarter rose 58 percent to 434 million euros.

 


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Tue, 06/26/2012 - 08:05 | Link to Comment Ghordius
Ghordius's picture

ah, the oldest bank, going back to the "mountains of debt" that the early italian bankers created... historic

Tue, 06/26/2012 - 08:07 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

Tradition!

 

Tue, 06/26/2012 - 08:14 | Link to Comment Colombian Gringo
Colombian Gringo's picture

Where's my fucking bailout?

Tue, 06/26/2012 - 08:19 | Link to Comment tocointhephrase
tocointhephrase's picture

Check your G-string!

Tue, 06/26/2012 - 08:21 | Link to Comment krispkritter
krispkritter's picture

I know right? I want an ECB ATM card where the ATM's spit out gold bars right into your hands. Back the armored Humvee up to it and put some junk in the trunk...a boy can dream can't he?

Tue, 06/26/2012 - 09:53 | Link to Comment Thomas
Thomas's picture

Gotta wonder how many bailouts occurred in 540 years.

Tue, 06/26/2012 - 08:15 | Link to Comment CPL
CPL's picture

And there goes silver and gold.

 

Yay!  Italy bailed out some worthless heap of bricks with fiat capital, pardon borrowed fiat capital.

Tue, 06/26/2012 - 08:17 | Link to Comment Rahm
Rahm's picture

World's oldest profession needs a bailout!

Tue, 06/26/2012 - 08:20 | Link to Comment Ghordius
Ghordius's picture

are we supposed to explain to someone with a nick of "Rahm" what the oldest profession is about? extortion and racketeering, of course! ;-)

Tue, 06/26/2012 - 08:25 | Link to Comment disabledvet
disabledvet's picture

"fascist piIgs" is more like it. The "tradition" stole the gold from a bank that survived this long because it always had that gold. CONFIDENCE...not CONfidence. Phucking mafia. The Church will sentence them all to death now.

Tue, 06/26/2012 - 08:08 | Link to Comment SheepRevolution
SheepRevolution's picture

Sort of funny to see that the oldest bank in the country who according to many invented fractional-reserve-banking, now might face its doom due to..... fractional-reserve-banking. Your own medicine doesn't taste to good ey?

Tue, 06/26/2012 - 08:23 | Link to Comment Ghordius
Ghordius's picture

nope. this old lady has a track record of five solid centuries of being bailed out, the other side of fractional-reserve-banking

Tue, 06/26/2012 - 08:26 | Link to Comment disabledvet
disabledvet's picture

YOU LIE EURO BITCH! That bank survived because the GOLD STAYED IN BANK and didn't "end up with the worthless euro." TIME TO DIE EURO BITCH!

Tue, 06/26/2012 - 12:10 | Link to Comment Ghordius
Ghordius's picture

disabledvet, LOL, what are you looking for? a bitch slapping? I'll take your post as humour, I usually appreciate your remarks.

meanwhile, you are conflating "mountains of debt", banking, fractional reserve banking, gold as a currency or as a CB reserve asset and bank-bailouts.

thankfully, you seem to be a stacker, like me, so your bitch idiocy does not extend to what might save you, bitchez.

Note that I was writing about this stuff of which you seem to be ignorant (something that can be cured) two blasted days ago.

Here 2554721 bitchez, I wrote last Sunday:

"...where the 13th century bankers created "mountains of debt" - akin to bad banks or sinking funds that were so useful that they kept being viable banks until the 21st century, like the Italian bank Monte dei Paschi di Siena."

Those "mountains of debt" were created as bad banks (yes, bank propaganda goes back to the 15th century) on the model that the creditors (mostly rich patricians) allowed the extension of maturity to a century or more (YES, A FORM OF DEBT JUBILEE), where merged because of lack of funds (another form of bailout), in this case the Monte dei Paschi and the Monte di Siena, (I think a century later - perhaps due to bad maturity planning), and were bailed out several times also during the various gold or silver standard epochs. There is more knowledge than google can bring you on your screen, bitchez.

Now, behave, bitch, or explain to me where you think I'm lying. And stop believing all this trash that the MegaBanks are writing on the EUR, they are the gold-suppressor parties.

Tue, 06/26/2012 - 14:55 | Link to Comment Ghordius
Ghordius's picture

is this you were alluding to? 2562283 btw, I can't help if your EUR shorts are around your ankles, I sure did not tell you to short it

Tue, 06/26/2012 - 08:17 | Link to Comment Ghordius
Ghordius's picture

by the way, a small error: the last number of 4.5 millions is the customer base, not the employees

interestingly, the wikipedia article does not explain where the "monte", i.e. the mountain comes from. those were the first unpayable "mountains of debt" that banking in the 15th Century created and that got recycled into something similar to a "debt that will never be repayed but will generate yield as long as..."

-------

I got interested in the Monte dei Paschi for the first time when they received from the Italian Government the job of collecting taxes in Sicily. After three months, the bank was already asking for more funds in order to collect them. Shockingly, the gov decided that tax-farming is not worth it if the tax-farmer is incompetent for this job...

Tue, 06/26/2012 - 08:17 | Link to Comment krispkritter
krispkritter's picture

Yeah, saw the 4.5mil employees and thought 'They're bigger than the US Gov't! Send in the drones!'. My next thought was that the bailout amount better start with T's and not B's...

Tue, 06/26/2012 - 08:24 | Link to Comment machineh
machineh's picture

'the wikipedia article does not explain where the "monte", i.e. the mountain comes from'

Probably this is a reference to the venerable card game, 'three-card monte.'

A metaphor, as it were ...

Tue, 06/26/2012 - 08:28 | Link to Comment disabledvet
disabledvet's picture

i thought "those were the ounces" and "the mountains was the storage facility...

Tue, 06/26/2012 - 12:54 | Link to Comment Jumbotron
Jumbotron's picture

Ghordius said:

interestingly, the wikipedia article does not explain where the "monte", i.e. the mountain comes from.

Actually...yes it did.....

From Wikipedia:

Banca Monte dei Paschi di Siena S.p.A. (MPS) is the oldest surviving bank in the world. Founded in 1472 by the Magistrate of the city state of Siena, Italy, as a mount of piety,

Click on mount of piety above.....and you will find out that that means that the bank was originally set up as....wait for it....wait for it....

A PAWN SHOP.....but with a twist.....here's a section from the Wiki article

This fifteenth-century institution originated in Italy and was developed in cities as a reform against money lending,[1] an early form of organized charity.

The public office was organized and operated by the Catholic Churchs and offered financial loans at a moderate interest to those in need.[2] The organizing principle, based on the benefit of the borrower and not the profit of the lender, was viewed as a lesser evil than money lending.[1] The organization of the Monte di Pietà depended on acquiring a monte, a collection of funds from voluntary donations by financially privileged people who had no intentions of regaining their money. The people in need would then be able to come to the Monte di Pietà and give an item of value in exchange for a monetary loan. The term of the loan would last the course of a year and would only be worth about two-thirds of the borrower’s item value. A pre-determined interest rate would be applied to the loan and these profits were used to pay the expenses of operating the Monte di Pietà.[3]

Now I hate to add this part since there seems to be a fair amount of Anti-Semetism on this site, but for the sake of completeness and history here is the rest.......

In 1462, the first recorded Monte di Pietà was founded in Perugia. Between the years 1462 and 1470, an estimated forty more of the same organization were developed.[7] The Franciscan Marco di Matteo Strozzi preached about the benefits of a Monte di Pietà in combating usury. He left a set of memoirs that outlined his goal to rid the city of Jewish money lenders and to replace them with Christian pawn shops which allowed the poor to acquire cheap credit.[8]

How far this bank has fallen since those early, lofty goals of providing a cheaper alternative to loans for poor people.....

Greed Will Out !

Tue, 06/26/2012 - 14:51 | Link to Comment Ghordius
Ghordius's picture

+1 jumbotron, I'm on travel and so I can't quote from the sources I was reading a couple of decades ago - and I would have to find them first anyway. So I'll just let some common sense appeal to you: "a collection of funds from voluntary donations by financially privileged people who had no intentions of regaining their money".

Let it roll on your tongue: voluntary, donation, rich people, who just have no intention of regaining their money.

Does it sound like a whole class of Oligarchs making a common donation or does it sound like a class of creditors getting stiffed?

 Does it sound like Bill Gates setting up a foundation with a few collegues or does it sound like the clients of MF Global being told that they will not get their money back?

Hence "no regaining"?

Of course there is propaganda involved. The story went on that the creditors had their maturities extended and extended and at the end their descendents gifted them, to at least score some political capital with the people and the Church.

 

Tue, 06/26/2012 - 09:26 | Link to Comment phungus_mungus
phungus_mungus's picture

My house burned down in a flash of thunder.
My wife ran off with a one-legged plumber.
My crops fell dead when the riverbed went dry.
My dog got squashed by a pickup truck.
My son ran away and got hooked on drugs.
My daughter's knocked up by the class of '85.

People say that life is good;
It don't seem good to me.
I'm lost without a paddle,
And I'm headed up shit creek.
People say that life is fun,
But I don't know why.
As far as I can tell,
LIFE SUCKS then you die.

The government dumps its toxic waste
Right on top of my mother's grave.
A team of experts say it won't do her no harm.
But my sheep went crazy and killed my mule.
I cut off my dick with a power tool
Fixin' the hole where the meteor hit the barn.
(And it hurt, too!)

People say that life is good,
But I just piss and moan.
I got one foot on a banana peel,
The other in the Twilight Zone.
People say that life is fun,
But I don't know why.
As far as I can tell,
LIFE SUCKS then you die.

Let me hear some "yee-hah"s out there!

I went to the store to buy some shells.
My gun went off and blew the owner to hell.
Now I'm sittin' here in jail, singin' this song.
And one guy wants to cut me with a knife.
Another guy wants me to be his wife.
Hey, I wish they'd hang me before somethin' really goes wrong!

People say that life is good,
Give thanks for what you have.
When all you have is nothin',
Nothin' makes you glad.
People say that life is fun,
But I don't know why.
As far as I can tell,
LIFE SUCKS, then you die.
I said, people say that life is fun,
But I don't know why.
As far as I can tell,
LIFE SUCKS,
LIFE SUCKS
LIFE SUCKS, then you die.

Tue, 06/26/2012 - 08:05 | Link to Comment EscapeKey
EscapeKey's picture

A bankrupt country bails out a bankrupt bank. What could possibly go wrong?

Tue, 06/26/2012 - 08:14 | Link to Comment TrainWreck1
TrainWreck1's picture

They need some sort of Transaction Security Agency to frisk & scan all parties involved. This would improve efficiency a gazillion-fold.

Tue, 06/26/2012 - 08:28 | Link to Comment machineh
machineh's picture

Dude, I thought the TSA was running the bank. 

At least they're driving the armored trucks, so they control the cash drain ... errr, flow.

Tue, 06/26/2012 - 08:19 | Link to Comment DormRoom
DormRoom's picture

fiat currencies presupposes trust, and being anchored in real assets.  Now, fiat currencies are IOUs backed by IOUs ad infinitum, and for the most part no longer anchored by anything 'real'.

 

It's the flow of false promises & IOUs that keep this turd system going.

Tue, 06/26/2012 - 08:28 | Link to Comment disabledvet
disabledvet's picture

"provided The Bank is dead...nothing."

Tue, 06/26/2012 - 08:06 | Link to Comment bdc63
bdc63's picture

uhm ... am I missing something?  where the heck did the Italian government get a billion euros to loan to a bank?

Tue, 06/26/2012 - 08:08 | Link to Comment GetZeeGold
GetZeeGold's picture

 

 

I think they were kinda hoping your weren't going to ask that.

 

Tue, 06/26/2012 - 08:11 | Link to Comment bdc63
bdc63's picture

maybe somebody made them an offer they couldn't refuse ...

Tue, 06/26/2012 - 08:30 | Link to Comment machineh
machineh's picture

Shoes for banksters, comrades.

Made outta concrete ...

Tue, 06/26/2012 - 08:21 | Link to Comment Vince Clortho
Vince Clortho's picture

The same place the US got the money to bailout the banks in 2008.

Tue, 06/26/2012 - 09:30 | Link to Comment walküre
walküre's picture

Dude, the FED bailed out all sinking ships in 2008.

The oldest Jewish Italian "noble" house was bailed out by a billion the Italian government found under a mattress ...

Tue, 06/26/2012 - 08:22 | Link to Comment dick cheneys ghost
dick cheneys ghost's picture

They got it from 'Thin Air, INC', whom makes money the old fashioned way, by Printing it.

Tue, 06/26/2012 - 10:07 | Link to Comment Zero Debt
Zero Debt's picture

If the people knew that, there would be a revolution tomorrow morning

Tue, 06/26/2012 - 08:06 | Link to Comment the not so migh...
the not so mighty maximiza's picture

I smell market rally, bailouts make those happen

Tue, 06/26/2012 - 08:06 | Link to Comment battle axe
battle axe's picture

And so the dance is well underway in Italy....Italy meet Greece, you guys have a lot in common....

Tue, 06/26/2012 - 08:08 | Link to Comment doomandbloom
doomandbloom's picture

is this what the Dinosaurs did during their wipeout?

Tue, 06/26/2012 - 08:18 | Link to Comment bdc63
bdc63's picture

it's different this time ... the dinosaurs were destroyed by an asteroid colliding with earth.  According to Jamie Dimon, our fate will be sealed when the moon crashes into the JPM headquarters in Manhattan.

apples and oranges ... not the same at all ...

Tue, 06/26/2012 - 08:08 | Link to Comment DocinPA
DocinPA's picture

Ruh roh!

Tue, 06/26/2012 - 08:09 | Link to Comment icanhasbailout
icanhasbailout's picture

any bank that wants to be "oldest surviving bank" in the future is going to have to figure out how to hide its operations from governments

Tue, 06/26/2012 - 08:08 | Link to Comment sandeepyadav
sandeepyadav's picture

Europe looks like sitting on fire and that can be explode on any moment http://sandyyadav.com/2012/06/26/european-union-submit-cyprus-is-junk-greecespainitaly/

Tue, 06/26/2012 - 08:09 | Link to Comment Its_the_economy...
Its_the_economy_stupid's picture

Umm, let me get this straight. The Italian banks buy sovereign debt, then the sovereign buys bank debt. Can my wife and I swap debt like that ad infinitum?

Tue, 06/26/2012 - 08:09 | Link to Comment tedstr
tedstr's picture

You can stop reading at 4.5 Mil employees.  Dear God.  That say s it all.  How much debt do you have to sell to support that.  Obvioulsy a lot and much of it was obvioulsy bad.

Tue, 06/26/2012 - 08:10 | Link to Comment LULZBank
LULZBank's picture

Pheewwwwww.. Thats a relief!

Tue, 06/26/2012 - 08:10 | Link to Comment valley chick
valley chick's picture

Forget the popcorn....A fine bottle of wine, good Italian dish, and kick back and savor the moment. :)

Tue, 06/26/2012 - 08:11 | Link to Comment caimen garou
caimen garou's picture

so they robbed peter to pay paul ,oh sorry they robbed mario to pay macalouso!

Tue, 06/26/2012 - 09:32 | Link to Comment walküre
walküre's picture

No, Mario Draghi robbed Peter and Paul to bailout his buddy Macalouso.

Don't ask questions.

Tue, 06/26/2012 - 08:13 | Link to Comment Alejandrito
Alejandrito's picture

the next step for Europe is quite clear or full integration or full blast

http://leadenhallst.blogspot.co.uk/2012/06/next-step-for-europe.html

Tue, 06/26/2012 - 08:14 | Link to Comment timbo_em
timbo_em's picture

Thank god we have an EU summit later this week that will present a once and for all solution for this crisis (just read the paper "towards a genuine economic and monetary union" by the four-headed monster) - a banking union that cannot be called a banking union and Eurobonds that cannot be called Eurobonds.

Because if the FANG countries don't want to be on the hook for €4000 bn of PIIGS sovereign debt, I'm sure they could be talked into being on the hook for three times that amount in banking debt.

 

Tue, 06/26/2012 - 08:22 | Link to Comment BlueCollaredOne
BlueCollaredOne's picture

Im in full agreeance.  The last 20 meetings have just been to prepare for this meeting.  That's how we do things in my business as well. We meet to discuss when we should meet and what to plan on planning for.  This is the time when Europes leaders meet to discuss what they have been meeting about and what they have been planning to plan for will come into fruition. 

 

 

 

Tue, 06/26/2012 - 08:15 | Link to Comment pmm009
pmm009's picture

So much for compound returns....Oh wait, nooo, I can't imagine anyone would have taken any capital out.  Did you say War?  Yes, but they could simply burry the loot in the ground till it passes...Can't do that anymore.

 

Tue, 06/26/2012 - 08:15 | Link to Comment ugmug
ugmug's picture

I hear that Italian Bank Executives will take refuge inside the Vatican.

Instead of kissing the Pope's ring they'll have to kiss the 'other' thing..........

Tue, 06/26/2012 - 08:16 | Link to Comment SamAdams1234
SamAdams1234's picture

that's for the altar boys.

Tue, 06/26/2012 - 08:23 | Link to Comment BlueCollaredOne
BlueCollaredOne's picture

Altar boys become altered boys

Tue, 06/26/2012 - 08:22 | Link to Comment Dick Darlington
Dick Darlington's picture

The lender has already covered more than 2 billion euros of its capital shortfall through the conversion of hybrid bonds and the implementation of new internal risk models, Chief Executive Officer Fabrizio Viola said last month.

So, if u have capital shortfall, just manipulate your internal "risk" models and POOF all shall be well. ROFLOL!

There ain't many solvent banks left in Europe, esp in peripheral countries and THAT'S WHY De Guindos, "Victory" Rajoy the insolvent banks and the unelected want "banking union". Banking union which means SOMEONE ELSE will be liable for the bad debts of these muppets. But the funniest thing is that "markets" still believe that will solve everything, turn shit into gold. It won't. There ain't no resources, willingness, for that.

 

 

Tue, 06/26/2012 - 08:23 | Link to Comment distopiandreamboy
distopiandreamboy's picture

I'm sure there will be no stigma for Banca Monte dei Paschi di Siena. Thank goodness for the summit this week that will solve everything.

Tue, 06/26/2012 - 08:44 | Link to Comment rufusbird
rufusbird's picture

comment withdrawn as i found it redundant.

Tue, 06/26/2012 - 08:27 | Link to Comment Vince Clortho
Vince Clortho's picture

It's all good.  Keynesian witchcraft at its finest.

Just print up the necessary funds and "loan" them to the corrupt, bankrupt bank.

There is no limit to how much debt the system can generate so the solution is print and loan forever.

 

Tue, 06/26/2012 - 08:31 | Link to Comment sudzee
sudzee's picture

4.5 million employees:

Is that the new description of depositers.

Tue, 06/26/2012 - 08:34 | Link to Comment matterhornclimber
matterhornclimber's picture

the lender of last resort the ECB will bailout much more bancs in Italy and other mediterrenian countries, as

the can to be kicked is not quite rusty yet and the deadend street is not at its end yet.

But when the can is falling apart from kicking then the street will also end!

Have a wonderful trading day!

 

Tue, 06/26/2012 - 08:41 | Link to Comment sabra1
sabra1's picture

for a second there, i thought the oldest Italian bank was the Vatican! the only place to get holy shit!

Tue, 06/26/2012 - 09:03 | Link to Comment Joe A
Joe A's picture

The Vatican is a state by itself, not part of Italy. Probably the Vatican bank is older than this Italian bank.

Tue, 06/26/2012 - 08:42 | Link to Comment e-recep
e-recep's picture

Bad investments of scums go unpunished. The world has become a hell hole.

Tue, 06/26/2012 - 08:45 | Link to Comment francis_sawyer
francis_sawyer's picture

Party like it's 1472... They needed the money to roll over the CDS that they had written back before Columbus sailed that the world is, in fact FIAT (I mean FLAT)...

Tue, 06/26/2012 - 09:35 | Link to Comment walküre
walküre's picture

you may be onto something here ...

if it goes back that far we will need to be allot more patient to see it unwind

Tue, 06/26/2012 - 08:44 | Link to Comment anyways
anyways's picture

From their website: 'Banca Monte Paschi Belgio is part of the Monte dei Paschi di Siena group which was founded in 1472. Therefore, more than five centuries of banking experience are at your service' ;-)

Tue, 06/26/2012 - 08:47 | Link to Comment GMadScientist
GMadScientist's picture

http://english.mps.it/La+Banca/Arte/

"The formation of the Monte dei Paschi di Siena Bank’s art collection is not only the result of an organic project formulated relatively recently, but also the product of layers of history, of commissions and purchases that slowly, over time, took on the shape of an actual collection."

Just the kind of deserving entity to shower with liquidity.

Tue, 06/26/2012 - 08:54 | Link to Comment Saro
Saro's picture

But if the Italian government didn't buy the bank's bonds, where would the bank get all the cash it needs to buy Italian government bonds at the next auction?

#fixed

Tue, 06/26/2012 - 09:08 | Link to Comment Kiwi Pete
Kiwi Pete's picture

You would have thought they would've learnt something in five centuries. LIKE HOW TO STAY SOLVENT!

Tue, 06/26/2012 - 09:09 | Link to Comment Joe A
Joe A's picture

Surely Mafia banks are older. Or are the legitimate banks part of the Mafia banking system. Stupid question, I know.

Tue, 06/26/2012 - 09:15 | Link to Comment Miss Expectations
Miss Expectations's picture

When I was in Italy, I use to go to the markets with my friend's mom.  She was trying to be helpful by telling me how to ask the price of things.   She said, "Just ask: Quanto veine? or Quanto costa?"  I said that that wasn't really helpful because they are going to tell me some huge number and the only thing that I will understand is the word lira at the end.

 

Tue, 06/26/2012 - 09:17 | Link to Comment Hulk
Hulk's picture

The basic problem is, everywhere, they are trying to fill a tire with a big hole in it that hasn't been patched. good luck with that financial folks...

Tue, 06/26/2012 - 10:17 | Link to Comment Euro Monster
Euro Monster's picture

Oh mio dio...

Tue, 06/26/2012 - 14:02 | Link to Comment supermaxedout
supermaxedout's picture

Banca Monte dei Paschi di Siena was not bailed out.

They only received a credit on their gold reserves. Banca Monte dei Paschi di Siena owns appx 30 % of the gold reserves of the Banca Italia. But in their balance sheet this position is calculated with appx. 25 US Dollar per ounce only, the historic price when they bought it.   So its risk free for the Italian government because Banca Monte dei Paschi di Siena is one of the best debtors one can imagine.

Tue, 06/26/2012 - 16:02 | Link to Comment mrkolice
mrkolice's picture

this is huge. how do you know this, can you post a source or a link? thx

Tue, 06/26/2012 - 17:54 | Link to Comment supermaxedout
supermaxedout's picture

I try to find it. I read it more than a year ago. It is a speciality of the Italian banking system. Banco Intesa San Paulo has also a huge chunk. In principle all big banks in Italia except Unicredit.

 

Tue, 06/26/2012 - 18:07 | Link to Comment supermaxedout
supermaxedout's picture

found something:

http://www.ft.com/intl/cms/s/0/e4bb2008-4376-11e0-8f0d-00144feabdc0.html...

Ok Intesa San Paulo has 30% so I got this wrong but Banca Monte dei Paschi di Siena owns also a big chunk of Banca Italias gold.

Do NOT follow this link or you will be banned from the site!