Banca Tirrenica

Banca Tirrenica was an Italian bank based in Arezzo, Tuscany. It represented the continuing, or “good bank,” operations separated from the failed Banca Popolare dell'Etruria e del Lazio during the resolution of four Italian banks in November 2015. The entity was initially established as Nuova Banca dell'Etruria e del Lazio S.p.A., also commonly referred to as Nuova Banca Etruria, and adopted the Banca Tirrenica name in May 2017 after its acquisition by UBI Banca. The institution's roots extended back to Banca Mutua Popolare Aretina, founded in Arezzo in 1881. Over the following decades, that cooperative bank expanded through mergers with other regional popular banks in Tuscany, Umbria and Lazio. It became Banca Popolare dell'Etruria in 1971 and Banca Popolare dell'Etruria e del Lazio in 1988 after the incorporation of Banca Popolare dell'Alto Lazio. The bank later broadened its group through acquisitions, including Banca Federico Del Vecchio and Banca Popolare Lecchese, and converted from a cooperative partnership into a joint-stock company in 2014. Its shares had been traded on Borsa Italiana since 1998 under the code PEL. The predecessor bank entered serious financial distress in the mid-2010s. Its capital ratios weakened, non-performing loans accumulated, and the Italian Ministry of Economy and Finance placed it under administration in early 2015. In November of that year, the Italian National Resolution Fund implemented a resolution under the European Bank Recovery and Resolution Directive. The original bank was split into a viable entity and a bad bank structure. The viable assets, selected liabilities and banking operations were transferred to the newly created Nuova Banca dell'Etruria e del Lazio, while impaired assets were transferred to REV - Gestione Crediti, a centralized bad-bank vehicle also used for other resolved institutions. The old bank was placed into liquidation, with shareholders and subordinated bondholders bearing losses under the bail-in framework. The new bank began with recapitalization and a materially stronger capital position than its predecessor. It continued the customer-facing banking operations of the former institution but was legally separate from the failed bank. It also disposed of its interest in Banca Popolare Lecchese in December 2015. In January 2017, UBI Banca agreed to acquire Nuova Banca Etruria, together with Nuova Banca Marche and Nuova CariChieti, for a nominal purchase price subject to balance-sheet cleanup and further recapitalization. The acquisition was completed in May 2017, when Nuova Banca Etruria was renamed Banca Tirrenica. The name referred to the Tyrrhenian region, an alternative geographical designation connected with the historic Etruria area. Banca Tirrenica was short-lived as an independent brand. UBI Banca announced a plan to integrate the three acquired banks, and the merger by absorption of Banca Tirrenica into UBI Banca became effective on 27 November 2017. As a result, Banca Tirrenica should be understood primarily as a transitional post-resolution banking brand rather than as an ongoing standalone institution.

Banca Tirrenica was the successor banking entity created during the 2015 resolution of Banca Popolare dell'Etruria e del Lazio, commonly known as Banca Etruria. Although the Banca Tirrenica name existed only briefly, its operating history derived from a much older Arezzo banking institution. The predecessor's earliest form was Banca Mutua Popolare Aretina, established in Arezzo on 16 April 1881. It expanded through a series of mergers with regional cooperative banks. In 1971 it absorbed Banca Popolare Senese and Banca Popolare della Provincia di Livorno and changed its name to Banca Popolare dell'Etruria. Further acquisitions followed, including Banca Popolare di Montepulciano in 1972, Banca Popolare di Pontevalleceppi in 1982, Banca Popolare di Cagli in 1985 and Banca Popolare di Gualdo Tadino in 1987. The 1988 merger with Banca Popolare dell'Alto Lazio produced Banca Popolare dell'Etruria e del Lazio. Another regional cooperative bank, Banca Cooperativa di Capraia Montelupo e Vitolini, was absorbed in 1990. The group became a listed company on Borsa Italiana in 1998. During the 2000s it pursued additional expansion, acquiring a majority stake in Banca Federico Del Vecchio in 2006 and the remaining interest in 2008. Banca Popolare Lecchese joined the group in 2008. In 2014 the parent converted from a cooperative partnership into a joint-stock company, a change that formed part of the broader restructuring of its corporate form. Financial deterioration became pronounced by the middle of the following decade. The predecessor was placed under administration by the Ministry of Economy and Finance in early 2015. Capital ratios had declined, and the institution carried a substantial burden of non-performing loans. A proposed support arrangement involving the Interbank Deposit Protection Fund did not become the final resolution mechanism. Instead, on 22 November 2015, the Italian National Resolution Fund recapitalized four troubled banks, including Banca Etruria, under the European Bank Recovery and Resolution Directive. The resolution separated the old bank into a good bank and a bad-bank structure. Nuova Banca dell'Etruria e del Lazio S.p.A. received the viable banking business and began with a stated Tier 1 capital ratio of 9% and share capital of €442 million. Non-performing assets were transferred to REV - Gestione Crediti, a vehicle shared with the other resolved banks. The original bank entered liquidation, while shareholders and subordinated bondholders lost their investments under the applicable bail-in arrangements. Subsequent public discussion of the treatment of retail investors led to a 2016 compensation mechanism for certain eligible holders of subordinated bank bonds. The new bank sold its majority interest in Banca Popolare Lecchese in December 2015. In January 2017 UBI Banca announced a binding offer for Nuova Banca Etruria, Nuova Banca Marche and Nuova CariChieti. The offer required the institutions' balance sheets to be cleaned up and additional recapitalization to be completed. The transaction was accepted on 18 January and completed on 10 May 2017. At completion, Nuova Banca Etruria became Banca Tirrenica. The name referenced the Tyrrhenian geographical area, one of the historical names associated with the territory of Etruria. Banca Tirrenica did not operate independently for long. UBI Banca announced the integration of the three acquired banks, and Banca Tirrenica was merged into UBI Banca by absorption on 27 November 2017. The brand therefore ended as a distinct entity less than three years after the creation of the good bank.

1. 2017Acquired by UBI Banca and renamed

   UBI Banca completed the acquisition on 10 May, after which the entity adopted the Banca Tirrenica name.

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2. 2017Merged into UBI Banca

   The merger by absorption became effective on 27 November, ending the standalone entity.

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3. 2015Good bank established

   Nuova Banca dell'Etruria e del Lazio was created on 22 November as the viable successor to the resolved bank.

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4. 1998Listed on Borsa Italiana

   The predecessor bank became publicly traded under ticker symbol PEL.

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5. 1988Banca Popolare dell'Etruria e del Lazio formed

   The merger with Banca Popolare dell'Alto Lazio expanded the institution's historical name and regional scope.

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6. 1971Name changed to Banca Popolare dell'Etruria

   After absorbing two Tuscan popular banks, Banca Mutua Popolare Aretina adopted the Banca Popolare dell'Etruria name.

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7. 1881Banca Mutua Popolare Aretina founded

   The institution's historical predecessor was established in Arezzo on 16 April.

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A regional Italian banking franchise created to preserve the viable operations of a failed bank, with a focus on continuity of ordinary banking services before integration into UBI Banca.

• Retail bankingBanking services2015

  The good bank continued ordinary customer banking operations inherited from the former Banca Etruria franchise, including deposit-taking, current-account services and payment facilities. Specific named product families are not identified in the available reference material.

• Lending and credit facilitiesCommercial banking2015

  Banca Tirrenica's operating bank scope included the viable lending relationships and credit activities separated from the failed predecessor. The available sources do not provide enough detail to identify individual loan products, pricing or customer segments.

• Savings and investment servicesSavings and investments2015

  The successor institution maintained a general banking franchise that included savings and investment-related services. Detailed product names and terms are not specified in the reference material.

• 2017Sale to UBI BancaM&A

  The resolved bank required a long-term owner after its creation as a good bank, and UBI Banca sought to acquire it together with two other resolved Italian banks.

  What changed. UBI Banca submitted a nominal bid, subject to balance-sheet cleanup and recapitalization, and completed the transaction on 10 May 2017.

  Aftermath. The acquired institution was renamed Banca Tirrenica and subsequently integrated into UBI Banca through a merger by absorption effective 27 November 2017.

  Purchase price. Nominal €1 bid accepted (January 2017 bid; transaction completed 10 May 2017)

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• 2015Separate viable and impaired banking operationsStrategy

  The predecessor bank was insolvent or no longer viable after prolonged financial deterioration, weak capital ratios and significant non-performing loans.

  What changed. Authorities created a new good bank for viable assets and liabilities, while transferring impaired assets to REV - Gestione Crediti and liquidating the old institution.

  Aftermath. Nuova Banca dell'Etruria e del Lazio began operating as a recapitalized successor, while shareholders and subordinated bondholders of the old bank were subjected to bail-in losses.

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• 2015Resolution and bail-in of Banca EtruriaControversy

  The predecessor bank's resolution resulted in losses for shareholders and subordinated bondholders. The treatment drew public criticism because Italian banks had sold some risky subordinated bonds to retail depositors, prompting a later compensation framework for certain eligible investors.

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• 2017UBI Banca submits bid for Nuova Banca Etruria

  UBI Banca made a binding nominal bid for Nuova Banca Etruria and two other resolved banks, subject to balance-sheet cleanup and recapitalization.

  M&A
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• 2017Nuova Banca Etruria renamed Banca Tirrenica

  Following completion of UBI Banca's acquisition, the bank adopted the Banca Tirrenica name.

  M&ALeadership changeOther
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• 2017Banca Tirrenica absorbed into UBI Banca

  The planned merger by absorption took effect, ending Banca Tirrenica's existence as a separate banking entity.

  M&AOther
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• 2015Italian resolution process creates Nuova Banca dell'Etruria e del Lazio

  The viable operations of Banca Popolare dell'Etruria e del Lazio were separated into a newly established good bank during the resolution of four Italian banks.

  BankruptcyRegulationOther
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• 2015Bad debts transferred during bank resolution

  The impaired assets of the failed institution were transferred to REV - Gestione Crediti, while the viable banking business remained in the new entity.

  BankruptcyRegulation
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1. Banca Tirrenica