Shares in troubled Italian bank dive on government plans

MILAN - Shares in troubled Italian bank Monte dei Paschi di Siena slumped after it emerged the populist parties negotiating to form a new government intend to keep the bank under state control.

Shares in Monte dei Paschi slid more than 4.3 per cent to 2.79 euros ($3.30) on Friday, a day after shedding nearly 9 per cent.

Italy's economy minister, Pier Carlo Padoan, said in a statement that the intentions of the leaders of the right-wing League and anti-establishment 5-Star Movement "have immediately created a crisis of trust" in the bank's shares. He called it "a serious matter that jeopardizes the investment made with public resources."

Monte dei Paschi is 68-per cent government owned after last year's bailout. Under European rules, state support can only be temporary.


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