Italy indicts top ex-bankers over derivatives scandal

ROME – Thirteen top officials from Banca Monte dei Paschi di Siena (BMPS), Deutsche Bank and Nomura are to go on trial in Milan for their alleged role in a long-running derivatives scandal, Italian newspapers reported Sunday.

The headquarters of Monte Dei Paschi di Siena bank on in Siena, in the Italian region of Tuscany

The accused in the trial due to open December 15 include Giuseppe Mussari, former chairman of the BMPS Foundation, his former chief executive Antonio Vigni, six former employees of Germany’s Deutsche Bank and two of Japan’s Nomura bank.

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The alleged crimes, committed between 2008 and 2012 and key to a scandal that has rocked BMPS since 2013, concern false accounting, share manipulation and obstructing regulators from Consob, Italy’s stock exchange watchdog.

The investigation focuses on derivatives trades called Santorini and Alexandria, conducted with Deutsche Bank and Nomura respectively to hide losses equivalent to two billion euros ($2.2 billion).

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The trial comes at a particularly tricky time for the oldest bank in the world — BMPS was founded in 1472 — as it is in the process of offloading 9.2 billion euros in non-performing assets and is urgently seeking new capital of up five billion euros.

Deemed a weak link in Italy’s banking system, BMPS came last in EU bank stress tests in July.

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Since the start of the year, the bank’s share price has dropped some 76 percent.

On September 14 it named a new chief executive and announced the resignation of its chairman as part of a major management shake-up.

In 2014, Mussari and Vigni appealed against convictions and jail terms handed down in relation the derivatives affair.