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ECB Extends Carige Temporary Administration to End of September

ECB Extends Carige Temporary Administration to End of September

(Bloomberg) -- The European Central Bank extended Banca Carige SpA’s period of temporary administration to the end of September, giving the struggling Italian lender more time to find a buyer and sort out its finances.

Carige confirmed the extension in a statement on Saturday. The mandate to administrators, who include Chief Executive Officer Fabio Innocenzi and a three-member surveillance committee, is to make sure the bank’s “prudential requirements” are covered in a way that’s sustainable, Carige said in the statement.

The ECB took the unprecedented step of placing Carige in temporary administration after the bank’s main investor blocked a vital capital increase in late December. Carige is the latest Italian bank asked by the ECB to bolster its finances. Faced with a potential failure, Italy’s cabinet, a few days after the central bank’s move, approved measures to support Carige’s liquidity and funding and signaled that the state would consider a recapitalization.

Carige’s potential buyers have started talks with the ECB over a possible deal with the Italian lender expected by mid-April, a person with knowledge of the matter said earlier this month. The Genoa-based bank expects to complete a deal in the second quarter, Innocenzi told reporters last month. It plans to sell about 2 billion euros ($2.3 billion) of non-performing loans, but may find a partner that wants to strike a deal that includes bad debt.

To contact the reporter on this story: Tommaso Ebhardt in Milan at tebhardt@bloomberg.net

To contact the editors responsible for this story: Chad Thomas at cthomas16@bloomberg.net, Tommaso Ebhardt, James Amott

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