Monte Paschi di Siena bank posts losses of 353 million euros

Losses due to 'one off' factors, restructuring ahead of schedule

(ANSA) - Milan, August 7 - Beleaguered Monte dei Paschi di Siena bank on Thursday posted losses of 353 million euros for the first semester this year in a worse than expected result evidently due to bond interest and credit corrections.

"The net result discounts a series of non-recurring elements including the cost of Monti bonds and their relative excessive weight, in the absence of which the 'normalized' result would be close to breaking even," the bank said in a statement. The troubled bank, the world's oldest still in operation, was thrown into crisis in January 2013 when it emerged that a shady series of derivative and structured-finance deals produced losses of 720 million euros.

Late last year, the bank's board approved a restructuring plan for the troubled Tuscan lender that included some 8,000 job cuts and 500 branch closures by 2017. Also during the first semester, interest margins fell to 972 million, down by 10.4%, after the Monti bond reimbursement was revalued by 147 million euros. The intermediation margin also fell to 1.843 billion euros, down by 4.7% due to "non-recurring components," said the bank. The Cet wealth coefficent rose by 13.5% thanks to a massive capital increase of five billion euros.

The bank's shares portfolio improved, amounting to 34 billion euros, a fall of only 2.2 billion compared to the first trimester of 2014 and a drop of some 6.4 billion euros over 2013. The bank said it has already reached its cost reduction target planned for 2017, reaching a major labour accord Wednesday in which unions agreed to some 1,300 layoffs that brought forward the planned closure of 150 branches to the start of 2015.