As the government explained yesterday, in the budget law of 2022, the Dta, the tax bonuses in the event of M&A, were cut. Technically, these are deferred tax assets that allow the deferred tax assets recorded in the financial statements to be classified as tax credits. If until 31 December the ceiling is equal to 2% of the assets of the prey company, from 1 January to June next year the limit has been cut to the smallest amount between 500 million euros and 2% of the assets.
This also happens because the DTAs were designed to resolve the government’s exit from 64% of MPS by December, but Unicredit has just closed negotiations with the Mef to take over a part of Siena, subject to yet another capital increase. And yesterday the CEO Andrea Orcel clearly told the market that the future of the bank is not in the direction of Monte (“Now the window is closed for us … I know, the windows open and close but for the moment and closed “, CEO Orcel specified yesterday).
Today the banks are suffering in Piazza Affari, especially Banco Bpm, considered possible prey by Unicredit thanks to the DTAs, loses 4.9% to 2.75 euros, Bper, involved in the scenario of concentration in Italy, gives 4.5% to 1.93 euros. Unicredit is just below the par at 11.49 euros after yesterday’s brilliant accounts with over a billion profits in the third quarter, beyond the expectations of the consensus and Mps drops by 0.6% to 1.04 euros. In this case, the loss is softened by the fact that the government will ask for at least one year of the bank’s standalone life to be able to further clean it up, waiting to find another way out when the Italian GDP (+ 3.8% year-over-year in the third quarter) and to support the financial system.
Morgan Stanley today calculated that the effects of the mini DTAs emerge above all in Unicredit-Banco Bpm, reducing from 4 billion to 500 million euros. And a Unicredit-Banco Bpm combination drops from 2.9 billion in tax benefits to just half a billion. Otherwise, analysts note, a different operation involving Banco Bpm and Bper or Bper and Popolare di Sondrio would suffer much less from the cut in tax benefits.
According to American analysts, a combination between Banco Bpm and Bper would see a 50% reduction in the value of the capital benefit, while a Bper-Sondrio merger would not be affected. The two extraordinary operations would need the approval of the shareholders’ meeting, there would be time by the end of the year to call the assembly. And at that point M&A would gain the biggest advantage linked to the full DTAs of 2021, concludes Morgan Stanley. It should be remembered that Sondrio is transforming itself from Popolare into Spa (thus becoming contestable) with Unipol which set foot in it months ago (and 9.5% of the capital) after having acquired 19% of Bper.
Intesa Sanpaolo analysts today write that extending the benefit of DTAs with a limit would be negative for the sector because it would significantly reduce the incentive for mergers and acquisitions involving large and medium-sized banks. Analysts recall that the DTAs deducted from the capital, with current rules, amount to 1 billion euros for Banco Bpm, 3.7 billion euros for Mps, 4.3 billion euros for Unicredit and 0.4 billion euros for Carige. According to the legislation which expires at the end of the year, the benefit is limited to 2% of the total assets of the companies involved in the operation, excluding the largest group. (All rights reserved)
