DBRS Confirms State Gteed Notes Issued by BPVI/Veneto Banca; Ratings Transferred to Intesa

DBRS Ratings Limited (DBRS) has today confirmed the ratings of BBB (high), with a Stable trend, on the State Guaranteed Notes (ISINs IT0005238859, IT0005247645, IT0005239527, IT0005239535, IT0005250185, IT0005257768, or the Notes) issued by Banca Popolare di Vicenza SpA and Veneto Banca Spa (or the Banks), following the confirmation of DBRS’ ratings on the Republic of Italy at BBB (high) / R-1 (low), with a Stable trend, on July 14, 2017. Concurrently, the ratings were discontinued and withdrawn from Banca Popolare di Vicenza SpA and Veneto Banca Spa, and assigned to Intesa Sanpaolo SpA (or Intesa), following the liquidation of the two Banks and the acquisition of these liabilities by Intesa, as announced on June 26, 2017.

The liquidation of Banca Popolare di Vicenza SpA and Veneto Banca SpA is regulated by the Law Decree no.99/2017, which needs to be converted into law. DBRS notes that the purchase agreement of Intesa includes a termination clause which establishes that the contract is ineffective and the assets/liabilities/legal relationships acquired can be given back to the banks in compulsory administrative liquidation. This refers, specifically, to the event that the decree law is not converted into law or is converted with amendments/integrations that make the transaction more expensive for Intesa, and is not fully enacted within the terms provided by law. DBRS expects the triggering of this clause to be highly unlikely.

RATING DRIVERS
The Notes are unconditionally and irrevocably guaranteed by the Italian State, therefore the ratings on these Notes are equalised with DBRS’ ratings on the Republic of Italy. Given the guarantee, the ratings on the State Guaranteed Notes will move in line with the ratings of the Republic of Italy.

Notes:
All figures are in Euros unless otherwise noted.

The principal applicable methodology is the Global Methodology for Rating Banks and Banking Organisations (May 2017). Other applicable methodologies include the DBRS Criteria: Guarantees and Other Forms of Support (February 2017). These can be found at: http://www.dbrs.com/about/methodologies

The sources of information used for this rating include company documents, the Ministry of Economy and Finance (MEF), the European Commission (EC) and the European Central Bank (ECB). DBRS considers the information available to it for the purposes of providing this rating to be of satisfactory quality.

DBRS does not audit the information it receives in connection with the rating process, and it does not and cannot independently verify that information in every instance.

Generally, the conditions that lead to the assignment of a Negative or Positive Trend are resolved within a twelve month period. DBRS’s outlooks and ratings are under regular surveillance

For further information on DBRS historical default rates published by the European Securities and Markets Authority (“ESMA”) in a central repository, see:
http://cerep.esma.europa.eu/cerep-web/statistics/defaults.xhtml.

Ratings assigned by DBRS Ratings Limited are subject to EU and US regulations only.

Lead Analyst: Nicola De Caro, Vice President – Global FIG
Rating Committee Chair: Elisabeth Rudman, Managing Director, Head of EU FIG – Global FIG
Initial Rating Date: September 13, 2013
Last Rating Date: June 29, 2017

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