Banca Popolare di Bari, the truth that nobody says about its transformation into a spa

Nobody did it. Nobody. Even the most authoritative financial media limited themselves to making a “copy and paste” of the press release with which Banca Popolare di Bari announced the incentives and the benefits expected for shareholders and subordinated bond holders if they attend the shareholders’ meeting on June 29 for the transformation of the bank into a spa following the capital increase of 1.6 billion euros financed by Fitd (Interbank Deposit Protection Fund) and MedioCredito Centrale (Mcc).

Yet for about a month now we have been following what some of the bank’s client-members are experiencing. Recall that most of the members have become such thanks to forcings of the soldier-bankers who made people subscribe to the capital increases necessary for the bank’s survival and made them buy the shares (better to say shares) in the continuous market.

Well, those same shareholders, who I refuse to call shareholders not only because they are not in terms of law but above all because it is presumable to assume that they have never been aware of being so, in the last few weeks have been bombarded by mail and phone calls of the usual soldiers to sign the proxies for participation in the assembly with implicit (because invited to sign the blank form) approval for the transformation.

Without any further information regarding the aforementioned press release. Nobody asked themselves some questions fundamental that any shareholder (or bondholder) should do before deciding whether to vote in favor of the transformation. What questions? Basically four:

1) How much is the new bank worth? The rating of the bank’s equity as of March 31, 2020 (reference date confirmed to us by the internal source) would provide the shareholder with important information regarding the estimate of the value of the bank of which he is and will be one of the owners

2) The whole bank will enter the balance sheet of the new bank that would be born (following the almost certain approval by the majority) balance of the previous bankruptcy bank (good and bad bank) or we are faced with another situation similar to that which occurred for the popular Venetian companies that Intesa purchased on condition of to leave the bad bank (impaired loans) with related consequences for the State?

3) How the price of was calculated 2.38 euros per share What has been guaranteed to those who have been pushed to subscribe to the 2014 and 2015 capital increase on the condition that they participate in the meeting and that they renounce “any claim or related action” to them? Because if it is true that the theoretical price of a share is calculated according to the formula equity / number of shares, then it means that the appreciation of the heritage net and the number of shares has already been done and, above all, it also contains the consistency of the 1.6 billion euro entered by Fitd and Mcc which will become reference shares?

4) The members who instead bought the shares in the continuous market that the BPB simulated to create (and therefore not on occasion of the capital increases of 2014 and 2015) can they continue or start their judicial defense actions even if they participate and approve the transformation? It would seem so, as confirmed by an authoritative internal source, since these partners, however, have been guaranteed, provided that participate at the meeting and without any further constraint, that the action will not be reset and that they will receive an unspecified number of free shares as a gift and also a warrant. Wow!

I tried to ask the courteous and kind press office and I also had a chat with one of the lawyers who is following the operation for the bank commissioners. I’ve waited so far (June 28) but … nothing. No further news that can guarantee transparency and awareness. And then, in the absence of further fundamental information, I summarize in favor of the many betrayed savers who solicit me for advice. I am for the “Yes” to transformation, but without the approval of the shareholders who subscribed to the capital increase in 2014 and 2015. Let me explain.

If I were one of those members “pushed” to buy shares or subordinated bonds on the occasion of the capital increases in 2014 or 2015 I would not participate in the meeting and, consequently, I would not subscribe to the transformation. Especially if I am one of those partners who has already started a legal action for the recognition of his rights. You wondered why the bank constrains the assignment of the gift (!!!) of 2.38 euros per share on the condition that the member renounces any legal action for the defense of his rights?

Because the eventual adhesion would involve one implicit awareness the status of shareholder which could be relied on in court as evidence of the full adequacy of the risk profile at the time of reading the prospectuses on the occasion of the subscription of the capital increases in 2014 and 2015. Furbi, eh?

If instead I was a partner who bought those shares in the continuous market (and therefore without any obligation to read the Informative prospect foreseen on the occasion of the capital increases), due to a less protected condition (otherwise they would also have offered them the guaranteed minimum price of 2.38 euros), I would participate at the meeting, I would approve the transformation (because, otherwise, my actions would be reset) and then, since there is no explicit exclusion condition, I would sue the new bank for the damage caused by the possible deception. In the meantime, what do consumer associations, consultants and the media do?