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Italy's Atlante fund to go ahead with purchase of Monte dei Paschi's NPLs

Quaestio Capital Management SGR SpA, which manages the Italian bank rescue fund Atlante, said Dec. 19 that it will move forward with its planned purchase of bad loans from Banca Monte dei Paschi di Siena SpA, which had said earlier the same day that the fund was reconsidering the purchase of €1.5 billion in bad loans from the lender.

Quaestio said it had decided to approve its planned investment in the securitization of Monte dei Paschi's nonperforming-loan portfolio after "obtaining certain conditions mitigating the refinancing risk of the senior bridge loan" Monte dei Paschi accepted as part of its attempt to off-load NPLs.

Monte dei Paschi has to complete its recapitalization by Dec. 31 after the ECB rejected its request for an extension. The lender also recently reopened its debt swap offer to convert certain subordinated bonds into equity from Dec. 16 to Dec. 21, extending it to retail investors after receiving approval from Italian market regulator Consob.