Banca Paschi posts $1.22 billion annual profits

23 March 2007

Banca Monte dei Paschi di Siena has announced record annual profits of $1.22 billion - a 21 per cent increase from 2005.

Meanwhile, revenue for the Italian bank rose to $6.35 billion euros, from $5.75 billion.

The showing from the Monte Paschi was worse than expected with analysts predicting profits of $2.23 billion and revenues of $6.65 billion, and is thought to have been damaged by the firm being forced to write off $138 million from its stake in holding company Hopa.

News of Monte Paschi's annual performance coincides with the issuing of a statement that it has agreed to sell French insurance company Axa half of its life insurance business MPS Vita for $1.5 billion.

Under the terms of the sale, Axa will acquire half of MPS Danni and MPS Vita, and half of the Tuscan bank's business in the open pension funds sector.

Monte Paschi's sale is one of a series of equity stakes it has sold in the last quarter, with the $1.3 billion it has raised reckoned to be earmarked for overseas expansion.

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