Financing is now underway for the $3.5bn Fioras latest bid to buy up the remaining 50% of the Italian banking assets of Bankia, the Italian sovereign debt holding company, as well as its holding company for other Italian assets.
The deal is being conducted by an investment bank backed by private equity funds and the proceeds are expected to come from the sale of the remaining bonds.
The €2bn sale of Bankias remaining bonds is a major milestone in Fioranis plan to shore up the banking sector after a series of crisis-related moves to boost domestic debt yields.
The deal is expected to close by the end of the year.
It is a significant achievement for the Italian government, which has been fighting to maintain a solid banking sector as it attempts to overhaul its struggling economy and is trying to find ways to boost its domestic economy.
It has been struggling to get the Italian banks to accept a bailout, and with Bankia in particular under pressure from its creditors, the government has been trying to get its hands on its remaining debt.
It has been unable to do so, with the banks now seeking a bailout from the International Monetary Fund, the World Bank and the European Union.
Bankia’s remaining assets are worth about €1.5 trillion.
Bankia’s bonds, which are issued by the Italian Bankers’ Association (BBA), are valued at about €300bn.
Banks have been offering €100bn of cash as collateral for the sale, and the bank is expected, as a condition of the deal, to pay a €10bn tax on the proceeds.
The government has pledged to repay the BBA, with its total stake at around €4.6bn.
The sale of those bonds has been a major political victory for Prime Minister Mario Monti, who has long pushed for a bank rescue.
The BBA is one of the largest institutions in Italy, and it is known for having strong anti-corruption credentials, particularly on issues such as tax evasion and money laundering.
In addition, the BBI, which is under Monti’s direct supervision, is expected not to be part of the financing.
The bank is also unlikely to have a say in the final terms of the sale as the government is unlikely to approve it.
The BBA has also said that it will not be part, in particular, of the new deal for the Banca Popolare di Vicenza, which holds the bank bonds.
It also does not own any of the Bankia bonds.
It was expected that the BMA would also not be a part of any financing for the new agreement for Bankia.
It was due to have the final say on the BDA.
The two bodies are part of a group of regional banks, called the UniCredit group, which have been trying for a banking rescue since 2010.
The current agreement between the two banks is part of that process.
The new deal will allow for the Uni Credit group to sell off some of its remaining assets, such as the shares in the BAA.