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European Commission extends deadline for Monte dei Paschi to issue Tier 2 debt

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European Commission extends deadline for Monte dei Paschi to issue Tier 2 debt

The European Commission approved Italy's request to extend the deadline for bailed-out lender Banca Monte dei Paschi di Siena SpA to issue a certain amount of Tier 2 instruments to reinforce its capital position, according to a Sept. 12 release.

To counterbalance the extended deadline and minimize possible distortions of competition, Italy proposed additional commitments aimed at further reducing the bank's costs and restoring its viability.

The European Commission said the new commitments preserve the balance of original commitments made under the bank's restructuring plan.

Moreover, the commission concluded that the amended commitments will not impact the overall time frame for the implementation of the plan.

Monte dei Paschi, which is ramping up the pace of its bad loan disposals, issued international bonds totaling €500 million in July.