Banca Intalease Derivate Debacle Update

Mark-to-market seems to be a spreading problem these days.........What started out a month ago with an estimated loss of 400 mio € is now already close 730 mio € ..........

Die "Mark-to-market" Problematik scheint sich schneller auszubreiten als vielen lieb ist.....Was vor einem Monat mit schon damals atemberaubenden 400 mio € anfing hat sich binnen 30 Tagen mal eben auf 730 Mio € "verbessert".....

Here is the history of posts / Hier die vorherigen Posts zu Banca Intalease

Italease Slumps as Clients May Lose EU400 Million

Banca Italease Derivate Slump Continues

Banca Italease Derivatives Fallout / Shares Suspended

Banca Italease Plunges Another 25%

29/06: Specifications regarding derivatives contracts

For a better comprehension of today’s press release, Banca Italease specifies that the closing out of more than four-fifth of the mark-to-market positions that were in effect with regard to derivatives executed with bank counterparties, led to a disbursement of around EUR 610 Million.



As of today the remaining contracts, still open with bank counterparties with a negative mark to market for Banca Italease, represent a total amount of around EUR 120 Million.

> Shares down over 10% with huge volume to a new low at 17.89.

> Aktien heute unter extrem hohen Volumen weiter im freien Fall minus 10% auf 17,89

Banca Italease Plunges Another 25%

the saga continues....click on the headline to read the fill press release (pdf).

die geschichte geht munter weiter...klickt bitte auf die überschrift um die veröffentlichung komplett zu lesen (pdf)

part 1 http://tinyurl.com/yomfos
part 2 http://tinyurl.com/2zumvb
part 3 http://tinyurl.com/35r6oh



With regard to the potential credit exposure of Banca Italease towards its
customers in relation to derivatives instruments, disclosed on 31 May 2007 with
reference to reports dated 22 May, for a total of approximately EUR 400 million,it is noted:

• around EUR 150 million were related to contracts that, with reference to
reports dated 5 June, entail potential exposure of the customers towards
Banca Italease of approximately EUR 235 million. The Bank has already closed out the related hedging instruments with bank counterparties, by paying an amount of around EUR 192 million.

• The remaining contracts, whose potential exposure of the customers towards Banca Italease was around EUR 250 million as of 22 May, entail potential exposure of approximately EUR 365 million as of 5 June; for these contracts, too, the Bank is evaluating the possibility to arrange for closing out the hedging instruments.....

>keep in mind that the combined net income for 2004-2006 was 348 mio €.......

>das ganze ausmaß wird erst deutlich wenn man bedenkt das in den jahren nur 348 mio € als nettogewinn ausgewiesen worden sind.

The number of contracts amount to approximately 2,600, related to around 2,200 customers; In particularly the potential credit exposure of the Bank towards the top 20 clients represents roughly 60% of the total.

In relation to the increase of such potential exposure of all the customers
of Banca Italease, the Bank informs that contacts with customers has been
initiated in order to provide specific clarification about their exposure and to
ascertain with them the best solutions to safeguard reciprocal interest. At the
same time, the Bank is proceeding to update the analysis of the
creditworthiness of customer counterparties. ....

Banca Italease cut to 'BBB+'; remains on rating watch negative
Fitch Ratings has cut Banca Italease SpA's issuer default rating (IDR) to 'BBB+' from 'A-' and said it remains on negative rating watch, reflecting the bank's increased exposure to credit, risk arising from concentration in its loan book and from the sale of structured derivative products to its client base.

At the same time, the bank's short-term 'F2' rating was placed on negative rating watch, while its individual 'C' and support '2' ratings were affirmed. The bank's 150 mln eur trust preferred securities were downgraded to 'BBB-' from 'BBB+' with a negative rating watch, Fitch added.

The agency said it expects to resolve the rating watch once the bank presents the outcome of its initiatives to resolve the client exposure arising from derivative products and said it will focus on the direct financial impact and effect on the bank's profitability and capitalisation over the longer term.

>the only surprise is that they have only downgraded one notch......next stop "junk"

>nur überraschend das nur um eine stufe gen süden abgewertet worden ist.....der nächste schritt heißt dann wohl "junk"

to be continued.......

Banca Italease Derivatives Fallout / Shares Suspended

another shoe to drop... still no dwongrade from the rating agencies....wouldn´t be the first time they are late to the party...... check out the label to see the first posts in italease.....

braut sich da ( wie bereits vermutet ) noch mehr ungemach zusammen.... und immer noch kein ratingdowngrade....wäre nicht das erste mal das zu spät reagiert wird....... unter dem label die vorhergehenden posts zu der schieflage

Market status Suspended

Credit Suisse Bought Italease Stock Before 33% Slide

Credit Suisse Group raised its stake in Banca Italease SpA, the Italian lender whose chief executive officer quit yesterday, to 5.3 percent from 2.1 percent on May 22. The stock has plunged 33 percent since then on concern about the company's liability to losses linked to derivatives.

The company on May 31 said clients face losses of 400 million euros after its potential liability linked to derivatives doubled from 225 million euros at the end of last year. Banco Popolare di Verona e Novara Scrl is Italease's biggest shareholder with a 31 percent stake.

Banca Italease Derivate Slump Continues

this is a follow up on the story

"Italease Slumps as Clients May Lose EU400 Million" http://tinyurl.com/yomfos .

hier eine nachbetrachtung der o.g. schieflage im derivategeschäft

Resignation of the Chief Executive Officer Massimo Faenza
Banca Italease's Chairman Lucio Rondelli renders notice that he has today received a letter from Massimo Faenza with which Mr. Faenza has relinquished irrevocably and with immediate effect all of his operational responsibilities and has resigned as a director of the Bank.

the stuck slumped another 15% yesterday...... and still no downgrade from fitch or moody´s from the already weakest possible a rating...

gestern weitere 15% abschlag......und immer noch keine abstufung der ratingagenturen des bereits jetzt niedrigsten a ratings....

to be continued..... :-)

Italease Falls as Clients May Lose EU400 Million on Derivatives

would be interesting to know who the clients are.... i can smell write downs.....and with net income of 197 mio € in 2006 this is "not insignificant" ratings are already at the weakest a rating! looks like they will have higher funding costs in the future.......

wäre nett zu wissen wer dort daneben liegt.....hier kann man größere abschreibungen förmlich riechen....und mit einem nettogewinn von 197 mio € in 2006 kann das extrem schmerzen.... zudem liegt deren rating schon jetzt auf dem schwächsten a rating. hier werden wohl bald deutlich höhere finanzierungskosten drohen........

June 1 (Bloomberg) -- Banca Italease SpA shares dropped as much as 13 percent after the Italian leasing company said its clients have accumulated potential losses of 400 million euros ($537 million) on derivatives contracts.

The stock declined 3.28 euros, or 9 percent, to 33.30 euros at 11:18 a.m. in Milan, giving the company a market value of 3 billion euros.

Italease's management will meet with customers in coming days to discuss the losses, the Milan-based company said late yesterday in a stock-exchange statement. The negative positions accumulated by Italease's clients widened to 400 million euros from 225 million euros at the end of 2006, the company said. The lender has already put aside 8.3 million euros of provisions.

here the official link to their investor relation site http://www.italease.it/investor/

UPDATE: stock closed down down 20%!