Banco BPM CEO says merger with Credit Agricole Italia would be good for Italy

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By Andrea Mandala Banco BPM Chief Executive Giuseppe Castagna said on Thursday that a merger with the Italian arm of France's Credit Agricole EURONEXT:ACA was the "clearest opportunity" for his bank, but there were others, such as a deal with Monte dei Paschi MIL:BMPS."They have an important bank in Italy, which is Credit Agricole Italia, lots of synergies with them ... it's for sure something that could be good for the Italian economy," Castagna told CNBC television in an interview.Credit Agricole is Banco BPM's biggest investor and helped the Italian bank fight a takeover attempt from bigger rival UniCredit MIL:UCG, which collapsed at the end of July. Castagna said Credit Agricole was "a happy investor" and BPM was also happy with the commercial partnerships it has in place with the French bank and about potential future opportunities."But of course, we can't not look at whatever else (is there)," he said. With its bid, UniCredit had derailed a potential tie-up between Banco BPM and Monte dei Paschi (MPS).The Italian government, eager to promote a merger with BPM as it reprivatised MPS after a 2017 bailout, sold a chunk of MPS to BPM last November. The UniCredit swoop, part of a wider consolidation wave redrawing Italian finance, prompted MPS to take over Mediobanca.Mediobanca's board resigned on Thursday, ahead of the offer's conclusion on Monday, after which MPS will outline to regulators its plans for running the Milanese merchant bank.Castagna said a tie-up with MPS remained an option for Banco BPM. Italy's government has opposed UniCredit's takeover of BPM invoking national security grounds. Rome would also vet a BPM deal with Credit Agricole Italia to ensure lending and savings were protected, a senior policymaker told Reuters this month, adding it was not a problem in itself that Credit Agricole was a French bank.

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