MILAN, Dec 21 (Reuters) – Italy is getting ready to cap at 240,000 euros ($254,496) the yearly pay of prime executives employed from 2023 in banks rescued by the state, a transfer that has bearings for the reappointment of Monte dei Paschi’s (MPS) (BMPS.MI) chief govt.
Rome owns 64% of the Tuscan financial institution after rescuing it in 2017.
A Chamber of Deputies committee handed the measure early on Wednesday as a part of last-minute modifications to the 2023 price range.
After failing to clinch a sale of Monte dei Paschi to UniCredit (CRDI.MI) final yr, the Treasury in February employed veteran banker Luigi Lovaglio to steer the Siena-based lender.
Lovaglio, a well-respected govt who constructed his profession at UniCredit to ultimately head the group’s Polish arm, in November pulled off a 2.5 billion euro capital increase in stormy markets.
Lovaglio personally invested 200,000 euros in Monte dei Paschi’s new share concern, which risked failing given traders’ reluctance to place cash right into a financial institution tainted by scandals on the backdrop of Ukraine’s battle, rampant inflation and an anticipated recession in Europe.
He runs for reappointment in April when Monte dei Paschi’s present board expires.
As a bailed out financial institution, Monte dei Paschi already applies curbs to executives’ pay and Lovaglio’s fastened pay quantities to 466,000 euros a yr with no variable compensation.
As a comparability the pinnacle of one other mid-sized Italian financial institution, Banco BPM (BAMI.MI), final yr earned 2.3 million euros.
Below phrases Italy agreed with European Union authorities, MPS executives can’t earn greater than 10 occasions the typical worker wage.
($1 = 0.9430 euro)
Reporting by Valentina Za in Milan and Giuseppe Fonte in Rome; Enhancing by Louise Heavens and Jonathan Oatis
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