Having collapsed 99.7% from its July 2007 highs at EUR93, Banca Monte dei Paschi Siena – Italy’s 3rd largest bank – is in dire straits. And in confirmation that the fecal matter is about to strike a rotating object, Italian regulators just ‘temporarily’ banned short-selling of BMPS stock. Of course, with various other derivatives available to ‘hedgers’ or those dastardly speculators (note – 5Y Sub CDS at 1633bps, record highs), the pressure is anything but lifted. In fact, this likely puts more pressure on its peers.
Consob adopts a temporary ban on short selling on Banca Monte dei Paschi di Siena spa shares. The ban shall apply for the entire trading day of Wednesday 6 July 2016
Consob decided to temporary prohibit short sales on Banca Monte dei Paschi di Siena shares – BMPS (ISIN code IT0005092165).
The ban will be enforce for the entire trading session of tomorrow, Wednesday 6 July 2016, on the MTA market of Borsa Italiana.
The prohibition was adopted pursuant to Article 23 of the EU Regulation on short selling, considering the negative price change recorded by the share.
The prohibition applies to short sales backed by stock lending. This extends the scope of the prohibition of naked short selling, already in force for all shares from 1st November 2012 in accordance with the abovementioned EU Regulation.
The text of the Resolution 19653 of 5 July 2016 is available on the websitehttp://ift.tt/1BVatmo.
Rome, 5 July 2016
So that explains why everyone piled into CDS today…
via http://ift.tt/29LKaDu Tyler Durden