$2.3 bn of Nomura assets seized in Monte Paschi probe
Prosecutors also seized about €14.4 mn of assets from three former managers at the world’s oldest bank
Milan: Prosecutors in Siena, Italy are seizing about €1.8 billion ($2.3 billion) of assets from Nomura Holdings Inc. as part of a probe into Banca Monte dei Paschi di Siena SpA’s use of derivatives to hide losses.
The sequestration is linked to allegations of fraud and usury, prosecutors said in a statement on Tuesday. They also seized about €14.4 million of assets from three former managers at the world’s oldest bank. The confiscations took place in Siena, Rome, Milan, Bologna and Catanzaro, the magistrates said.
Monte dei Paschi has alleged Nomura colluded with its former managers to devise one of two derivatives in 2008 and 2009 that hid total losses of much as €557 million. Nomura reaped at least €88 million from its derivative, dubbed Alexandria, according to Siena, Italy-based Monte Paschi.
“About €1.7 billion of the assets seized are collateral pledged by Monte Paschi to Nomura as part of a financing the Japanese bank arranged for the Italian lender," prosecutors said.
Nomura’s former European head Sadeq Sayeed and the bank’s Raffaele Ricci are under probe for colluding to obstruct regulators and making false statements, prosecutors said on Tuesday. Sayeed declined to comment by telephone, while Ricci didn’t return a call and an e-mail seeking comment.
Monte Paschi has said Nomura’s transaction, and a similar derivative designed by Deutsche Bank AG, should never have been put together. The two firms were perfectly aware of the context, the illicit objectives of Monte Paschi’s former executives, the company said in a report released 29 March.
Deutsche Bank said Monte Paschi’s claims were entirely without merit and that the lender would defend itself vigorously. BLOOMBERG
Tommaso Ebhardt in Milan and Gavin Finch in London contributed to this story.
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