Monte dei Paschi Lifts Profit Outlook as Intesa Takeover Nears

what happened

Italian lender Monte dei Paschi di Siena increased its third-quarter net profit to 542.9 million euros from 474.0 million a year earlier, the bank said on Friday, according to Dow Jones Newswires. Analysts had expected 468.4 million euros, based on Visible Alpha consensus estimates. Total revenue rose 8.7% to 2.00 billion euros, while net interest income reached 1.11 billion euros, helped by higher lending volumes.

The bank also raised its 2026 pretax profit guidance to above 3.7 billion euros from above 3.6 billion euros. The forecast excludes the possible effect of Italy's 2027 budget, which lifts the corporate tax rate for banks to 30.5% from 27.5%, a change the bank is still assessing. Its CET1 ratio stood at 16.4% at the end of September and is expected to be around 15.5% at the end of 2026.

Intesa Sanpaolo is offering 1.25 euros in cash and 1.6 of its own shares for each Monte dei Paschi share, a deal the bank values at about 34.3 billion euros based on Thursday's closing prices. Monte dei Paschi has neither backed nor rejected the offer and aims to finish its review by the end of November, according to Update.

why it matters

For markets, two points stand out: a strong quarter and a higher profit forecast suggest the bank's earnings can absorb a possible tax increase, while the 34.3 billion euro deal sets a valuation benchmark for Italian banks. Shareholder decisions and a regulatory approval expected early next week will shape what happens next.

market impact

Monte dei Paschi shares: profit above forecasts and a higher guidance support the stock, but the Intesa bid adds uncertainty

• ▲Monte dei Paschi shares pressure up — profit above consensus and a raised pretax profit forecast

tags

instruments