ING enters the Italian banking scrap?

ING is reportedly interested in Italian bank Popolare di Sondrio as part of its European expansion. According to information obtained by Reuters, the Dutch banking group recently met with the Italian bank's management. This adds yet another unknown factor to the complex meccano underway at the Italian bank.

The discussions, which are said to still be at a preliminary stage, may not be successful, according to the prudential formula. ING Groep and Banca Popolare di Sondrio declined to comment, in what is again a classic posture in such circumstances. A possible offer from the Dutch group would compete with BPER Banca's February offer of €4.3bn in shares.

BPER and Sondrio share a common principal shareholder in Unipol, Italy's second-largest insurer, which holds around 20% of each entity. On Friday, Unipol chairman Carlo Cimbri confirmed that a foreign bank was considering a rival bid, suggesting that it was ING.

Based in the Alpine valley of Valtelline, northeast of Milan, Sondrio has appointed Bank of America and Morgan Stanley to defend itself. The bank promised to redistribute €1.5bn to its shareholders over 2025-2027, doubling the payments made in the previous three years, to deter any hostile bid.

Meanwhile, in February ING stated that it wanted to expand in Italy, Spain and Germany, targeting takeovers of local banks. Present in Italy since 2001, it has 1.275 million customers there.

"These rumors follow those circulating several weeks ago that ING was considering a potential takeover bid for Banco de Sabadell in 2024," AlphaValue analyst Sylvain Perret says, who sees the rumors as positive for ING, "as they would allow the bank to expand its footprint outside its traditional markets in northern continental Europe".