DBRS Assigns BBB (high) Rating to BMPS’ State Guaranteed Notes

DBRS Ratings Limited (DBRS) has today assigned a long-term rating of BBB (high) to the EUR 4 billion unsubordinated Notes (the Notes) due March 15, 2020 (ISIN: IT0005246423) issued by Banca Monte dei Paschi di Siena SpA (BMPS or the Bank), guaranteed by the Italian State under the Law Decree no. 237/2016, as subsequently amended by law of conversion no. 15/2017 on February 17, 2017. The trend on the rating is Stable, in line with the trend on the ratings of the Republic of Italy.

The Notes issued by the Bank are unconditionally and irrevocably guaranteed by the Italian State. The Italian State is committed to ensuring the timely payment of principal and interest in the event that the Bank is not able to fulfil those obligations. Accordingly, the rating of the Notes is equalised with those of the Republic of Italy and is subject to the maintenance of the Republic of Italy’s Long-Term Foreign and Local Currency ratings of BBB (high), with a Stable trend. The rating is subject to the maintenance of the State Guarantee.

The guarantee is regulated by the Law Decree no. 237, 23 December 2016, as subsequently amended by law of conversion no. 15/2017 on February 17, 2017.

DBRS currently rates BMPS’ Issuer Rating and Senior Long-Term Debt & Deposit ratings at B (low) and Short-Term Debt & Deposits at R-5. The ratings are Under Review with Developing Implications.

RATING DRIVERS
As a result of the guarantee, the rating of the State Guaranteed Notes will move in line with the ratings of the Republic of Italy.

Notes:
All figures are in Euros unless otherwise noted.

The principal applicable methodology is the Global Methodology for Rating Banks and Banking Organisations (July 2016). Other applicable methodologies include the DBRS Criteria: Support Assessments for Banks and Banking Organisations (March 2017), DBRS Criteria: Rating Bank Capital Securities – Subordinated, Hybrid, Preferred & Contingent Capital Securities (February 2017), Critical Obligations Rating Criteria (February 2017) and DBRS Criteria: Guarantees and Other Forms of Support (February 2017). These can be found at: http://www.dbrs.com/about/methodologies

The sources of information used for this rating include company documents and the Ministry of Economy and Finance (MEF). DBRS considers the information available to it for the purposes of providing this rating to be of satisfactory quality.

DBRS does not audit the information it receives in connection with the rating process, and it does not and cannot independently verify that information in every instance.

Generally, the conditions that lead to the assignment of a Negative or Positive Trend are resolved within a twelve month period. DBRS’s outlooks and ratings are under regular surveillance.

For further information on DBRS historical default rates published by the European Securities and Markets Authority (“ESMA”) in a central repository, see:
http://cerep.esma.europa.eu/cerep-web/statistics/defaults.xhtml.

Ratings assigned by DBRS Ratings Limited are subject to EU regulations only.

Lead Analyst: Nicola De Caro, Vice President – Global FIG
Rating Committee Chair: Ross Abercromby, Senior Vice President - Global FIG
Initial Rating Date: January 18, 2013
Most Recent Rating Update: January 31, 2017

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