Reform of Italian Cooperative Banks: Update

March 26, 2015

On March 24, 2015, the Italian Parliament ratified the so called “Investment Compact” (Law Decree No. 3 of January 24, 2015) containing measures to stimulate investments in the Italian economy.

As described in our Alert Memorandum of February 5, 2015, the Investment Compact requires the largest Italian cooperative banks (banche popolari) to relinquish the distinctive “one-person-one-vote” rule and convert into joint-stock companies (società per azioni). The provision affects 11 banche popolari.

During the ratification process, with a view to phasing in the application of the new regime, the Parliament approved an amendment enabling companies resulting from the mandatory transformation of banche popolari to introduce in their by-laws a 5% voting cap for a period of up to 24 months from the entry into force of the Investment Compact as amended.

As noted in our previous Alert Memorandum, the Investment Compact is likely to trigger a new aggregation process in the Italian banking system involving former banche popolari and other market players.

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If you have any questions concerning this memorandum, please feel free to contact Roberto Casati, Roberto BonsignorePietro Fioruzzi or Fabio Saccone in our Milan office (+39 02 72 60 81) or Giuseppe Scassellati-SforzoliniClaudio Di Falco or Laura Prosperetti in our Rome office (+39 06 69 52 21), or any of your regular contacts at the firm.