The banking crisis will bring further surprises, but one thing is already certain: the market has sidelined politics

The soporific stability offered over the last four years by the Meloni government has deprived many observers of a classic feature of Italian journalism: the coverage of political manoeuvring, of ministers resigning, of plot twists, of sudden reversals and of unexpected political moves. It has been the Italian banks that have provided entertainment in recent years for bewildered political insiders and even some bored readers. For years now, when it comes to plot twists, sudden reversals, unexpected manoeuvres, and epic stories both big and small, they have been every bit as compelling as the old political games of the good old days of unstable governments, which used to offer so much satisfaction to reporters. The most interesting saga concerning the banking world is the one involving the reshuffling of the banks, and in recent days the news has provided us with new material – both explicit and implicit – to reflect on the ‘Odyssey’ of the banking game of Risk. What we know is that between the end of September and the autumn, the public takeover and exchange offer (OPA) launched by Intesa Sanpaolo on Monte dei Paschi di Siena will commence, sixteen Intesa shares for every ten MPS shares, plus one euro in cash for each MPS share. This offer provides for the acquisition of MPS, including its controlling stake in Mediobanca, and, should the operation be successful, would enable Intesa Sanpaolo to become, via Mediobanca’s stake in Generali, the largest shareholder in the ‘Lion of Trieste’.

Intesa Sanpaolo’s bid appears difficult to counter, but for several days now two senior executives have been attempting to present an alternative to the MPS shareholders’ meeting. The two executives are the CEO of MPS, Luigi Lovaglio, and the CEO of Banco BPM, Giuseppe Castagna, who are set to make a move before Intesa Sanpaolo’s transaction goes ahead. A merger? An agreement? An acquisition? BPM has already officially proposed a merger of equals, citing over 1.1 billion in annual synergies and at least 5.5 billion in value creation. According to some observers, the only move that could create a form of competition capable of rising to the challenge at the MPS shareholders’ meeting is one that would involve not merely an agreement, but a public exchange offer by MPS for BPM shares (the issue of a possible cash component would remain, providing an additional incentive to convince shareholders). It is difficult to say how this will play out (a merger or a share-for-share offer would need to be approved by an extraordinary general meeting, whilst regarding Intesa’s OPAS, each shareholder will decide individually whether to accept it; and until it is clear what Lovaglio and Castagna are working on, it will not be possible to gauge how solid the alternative to Intesa’s offer might be). It is simpler to try to trace the thread of the banking ‘Risiko’ as it has unfolded in recent years, whilst also offering some insight into certain future and probably inevitable moves. It has been said, written and reported that in an Italy where ‘sovereignism’ is applied to the banking sector, politics has played a particularly intrusive role, manoeuvring its pawns in a decisive, devastating and irreversible manner. What we are seeing after more than two years of this ‘banking Risk’ is that the further we go, the less politics appears to have any real leverage to make a difference. 

The Ministry of Economy and Finance (MEF), which holds a 4.86 per cent stake in MPS, has announced that by next year it will have divested all its banking holdings; according to Il Foglio, the MEF’s exit from MPS could take place as early as August, to avoid having to choose between accepting the public exchange offer (OPA), remaining a shareholder in MPS or receiving Intesa shares. The approach likely to be adopted is the so-called ‘accelerated bookbuilding’, with an informal cap on individual allocations: no investor holding more than 1 per cent, with blocks generally around 0.3 per cent. The MEF, as is well known, would have liked to build a third banking hub centred on BPM and MPS, to create a genuinely Italian third pole; and whilst Lovaglio and Castagna wish to move in that direction, they will only succeed in their aim by pursuing a competitive alternative to Intesa’s offer: it is the market alone that will count, not politics. Furthermore, the prospect of a purely Italian third banking group does not currently appear to possess the characteristics envisaged by politicians, given Crédit Agricole’s rapid increase in its stake in BPM, which now stands at 29.3 per cent. In the event of a deal between MPS and BPM, Crédit Agricole’s stake would be automatically diluted by the issue of new shares, whilst any compensation would relate to governance or commercial agreements. What is more, the political establishment – and the Ministry of Economy and Finance (MEF) in particular – has had to backtrack even where it had exercised its powers: between 2024 and 2025, Giorgetti imposed strict conditions on Unicredit when the latter sought to acquire BPM. Those restrictions scuppered Unicredit’s bid, demonstrating that the government retains the power to block, rather than to build the desired alternative, prompting Unicredit to look elsewhere – such as Germany – where, for the time being, the government there too appears to have been defeated.

At Commerzbank, where Unicredit now holds around 48 per cent, the German government also holds a significant minority stake; having previously attempted to make life impossible for Unicredit, it has had to acknowledge the strength of the market, whilst continuing to defend the bank’s German headquarters and jobs. Today, however, the Ministry of Economy and Finance has once again knocked on Unicredit’s door to assess a potential revival of interest in BPM, a development first reported months ago by "Il Foglio" and confirmed by reliable government sources. Unlike two years ago, politicians have chosen to act on the market not by ‘addition’ – that is, by imposing further restrictions – but by ‘subtraction’, promising to do no more than has already been done in the past, much to the relief of those at Piazza Gae Aulenti. The political sphere, which was supposed to dictate the timing of the banking ‘Risiko’, finds itself, at the end of the day, on the sidelines more as a supporter than as a player: Giorgetti is rooting for BPM to take centre stage, whilst Meloni is backing the Intesa Sanpaolo deal. It finds itself in a scenario that does not exactly match its wishes, with a fourth bloc featuring the very strong French players, and a third bloc destined to be absorbed into the world of the ‘red’ cooperatives – namely BPER-Unipol – which, under the Intesa deal, would receive around 635 MPS branches, the Siena-based bank’s brand and its central functions, whilst a second bloc – without the BPM deal – could find itself with UniCredit increasingly focused on Germany, without any transfer of its registered office being a foregone conclusion at present. And with a future objective known as Generali, where politics, rather than acting as a player, can hope to achieve the desired results.

Today, Mediobanca-MPS holds 13.32 per cent of Generali, Delfin 10.15 per cent, Unicredit 8.80 per cent, Caltagirone 6.32 per cent and Intesa 3.13 per cent: if Intesa were to acquire MPS and retain Mediobanca, its direct and indirect stake would, arithmetically speaking, rise to around 16.45 per cent. And the desired outcome, at least from some quarters of the political sphere, is that in the Generali of the future there might be a balance between the largest shareholder (Mediobanca-MPS and therefore probably Intesa), the second-largest shareholder (Delfin), the third-largest shareholder (UniCredit, ready to increase its stake should the largest shareholder grow), and the fourth-largest shareholder, Caltagirone, who, despite having taken a knock in the MPS deal, remains central to the next moves, from MPS to Mediobanca. The hope of the political sphere, Palazzo Chigi and the Ministry of Economy and Finance (MEF) is that, at least at Generali, their aspirations might come to fruition, resulting in a public company with many shareholders and no controlling shareholder. Predicting how the banking game of Risk will end is difficult, perhaps impossible. To say, however, that Italian banks have, thanks to this banking game of Risk, demonstrated their strength, vitality and ambition is a fact that offers an interesting insight into the state of our country. By the end of 2025, the average ROE of Italian banks (ROE is a ratio that measures how much profit a bank generates relative to the capital invested by its shareholders) had risen to 13.8 per cent, up from 12.7 per cent the previous year, with net non-performing loans falling to 1.3 per cent of total loans. Having a country with strong banks is not a sign of growing social injustice – ‘blame the bankers’ – but a sign of strength, vitality and vigour. And having a country where the market is so strong that it occasionally sidelines politics is news that allows us to be optimistic about the future of the banking ‘Risiko’ saga; whatever course it takes, it cannot fail to end this way: it’s the market, my friend.