By Mauro Orru

 

Banca Monte dei Paschi di Siena SpA issued a senior preferred unsecured bond for 750 million euros ($794.7 million), more than two years since its last issuance and after swinging to a profit in the fourth quarter.

The world's oldest bank said late Thursday that it had raked in orders for about EUR1.6 billion from a pool of more than 150 investors, setting the final yield at 6.75%. The bond has a three-year maturity.

"The issue represents a successful return of MPS to the institutional market, more than two years after the last issue," the bank said.

The announcement comes a week after Moody's Investors Service Inc. lifted the bank's long-term senior unsecured debt rating by three notches to B1 from Caa1, saying fourth-quarter results "already reflect structural profitability improvements--post large staff lay-offs-all the more so since the bank reaps the benefits of rising interest rates."

The Tuscan lender last year completed a EUR2.5 billion capital increase as it sought to shore up its capital base and turn a page on a chapter that saw it undergo state recapitalization and the disposal of billions in bad loans.

Monte dei Paschi has long been weighed down by a mountain of bad loans and a legal scandal. After the bank teetered near failure, the Italian government spent some EUR5.4 billion to nationalize it in 2017, equivalent to more than $6 billion at the time.

 

Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94

 

(END) Dow Jones Newswires

February 24, 2023 01:57 ET (06:57 GMT)

Copyright (c) 2023 Dow Jones & Company, Inc.
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