Monte dei Paschi's Generali Overture Adds New Layer to Italian Banking Standoff

MPS sounds out Generali on cooperation as its 29 October shareholder vote on Banco BPM and Banca Generali offers needs 67% backing.

Banca Monte dei Paschi di Siena has opened a second front in its fight to stay independent, with chief executive Luigi Lovaglio writing to the board of Assicurazioni Generali on 28 September to sound out avenues for industrial cooperation. The approach, confirmed by the Tuscan lender, is neither a binding bid nor a formal commitment to negotiate — it is an exploratory move covering potential joint work in bancassurance, distribution, asset management, wealth management and corporate services.

The timing carries its own logic. Monte dei Paschi's existing distribution pact with French insurer AXA runs out in 2027, leaving a gap the Sienese bank would need to fill. Any defensive manoeuvre, however, is constrained by Italy's passivity rule, which limits a takeover target's ability to take unilateral action while an offer is live. Generali, for its part, is busy with its own housekeeping: it has approved the absorption of Alleanza Assicurazioni into Generali Italia, a merger due to complete in the first half of 2027. Italian press reports suggest MPS is also weighing a purchase of the 13.3 percent Generali stake held by Mediobanca, should its own plans founder.

A Vote That Needs Two-Thirds

All of this unfolds against a hard deadline. On 29 October 2026, shareholders will vote on the twin share-swap offers for Banco BPM and wealth manager Banca Generali — the centrepiece of Lovaglio's alternative to Intesa Sanpaolo's rival bid. Passage requires 67 percent of the votes cast, and that threshold is looking shaky.

Delfin, the holding company with 17.5 percent of MPS and its largest single investor, will not commit until advisory firm Lazard completes a review. Entrepreneur Francesco Gaetano Caltagirone, who controls 13.5 percent, is leaning toward rejecting the management's proposals, according to Milano Finanza. Lovaglio conceded in an interview with Bloomberg TV that he had not spoken personally with either anchor shareholder about the plan, though he expressed confidence they would recognise its industrial merit.

Other holders are adding to the uncertainty. The Italian economy and finance ministry, which owns 4.7 percent, has said it will stay away from the meeting, and Banco BPM is considering doing the same with its own 3.7 percent stake. The Enasarco pension fund, holder of 1 percent, has signalled it would accept Intesa's offer if the terms are improved. Should the vote fail, Lovaglio has confirmed there is no fallback plan in place.

Lovaglio's Case — and His Warning

The CEO has been making the argument that his proposals keep pricing pressure on Intesa Sanpaolo, whose 30.6 billion euro offer, in his telling, still understates the true worth of the Sienese institution. He has also pointed to a planned special dividend totalling 4 billion euros, to be paid partly in cash and partly in Generali shares, as evidence of the value on offer. In a pointed warning, he said a takeover by Intesa would break up the historic bank, noting the 4 billion euros in extraordinary dividends it has already distributed. On antitrust remedies, Lovaglio raised the possibility of UniCredit stepping in to acquire branches in northern Italy if competition rules forced divestments — while making clear no concrete talks have taken place.

He also pushed back on how to read the upcoming gathering, telling Bloomberg TV it should not be treated as a direct referendum on Intesa's competing bid. The aim, he said, is to keep a credible alternative alive and maintain competitive tension.

Intesa Clears Regulatory Ground

The Milan-based suitor, meanwhile, is steadily ticking boxes. Il Corriere della Sera reports that Intesa Sanpaolo has secured more than 75 percent of the 46 authorisations required from regulators across roughly 30 countries — all of them free of restrictive conditions. The pivotal European Central Bank decision is expected in mid-to-late October, after which Italian market regulator Consob must rule on the prospectus.

Monte dei Paschi shares came under pressure as the Generali news circulated, closing down 3.6 percent at 11.34 euros. Despite that slide — and a 2.2 percent decline since the bank reaffirmed its sector takeover plans roughly two weeks ago — the stock remains up 25 percent since the start of the year. Shareholders' final verdict on the institution's future is expected in November or December 2026.